Question

If current assets amount to $120,000, total assets are $600,000, current liabilities are $60,000, long term debt is $340,000 and total liabilities are $400,000, what is the current ratio?

Answer 1

2

Step-by-step explanation:

Current ration is a financial measure used to measure how many times a company's current assets can be used to meet its current obligation

Current ratio = current asset/current liabilities

Current assets = $120,000

Current liabilities = $400,000 - $340,000

= $60,000

Current ratio = $120,000/$60,000 = 2 times