Multiple choice

The method of current ratio is

  1. current assets/current liabilities

  2. liquid asset/current liabilites

  3. current liabilities/liquid assets

  4. current liabilities/current assets

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Right answer because current ratio means condition of current assets to current liability. It tests out capabilities to pay the liability. So, we can find the current ratio by this method.