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How "Current Ratio" is calculated? 1. Current Assets/Current Liabilities or 2. Current Liabilities/Current Assets

Financial Reporting
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Question added by Deleted user
Date Posted: 2013/06/05
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Ali Iftikhar
by Ali Iftikhar , Assitant Manager Finance , National Logistics Cell

Current Ratio = Current Assets / Current Liabilities

Frank Avitia
by Frank Avitia , Managing Director , AIS Investment Services

Current Assets/Current Liabilities Current ratio is the ratio of current assets of a business to its current liabilities.
It is the most widely used test of liquidity of a business and measures the ability of a business to repay its debts over the period of next12 months.

umer zubair
by umer zubair , international sales executive , digital globe service

CURRENT ASSETS/CURRENT LIABILITIES

Dilshod Gaibnazarov
by Dilshod Gaibnazarov , Financial Accounting Manager , Logistics and transportation company

current ratio=current assets/current liabilites also usefull acid ratio=(cash +Accont receivable+short-term investment)/current liabilities

Salman Ali
by Salman Ali , Senior Manager Finance , Pakistan Mercantile Exchange Limited

1.
Current Assets/Current Liabilities

manaf almas
by manaf almas , Auditor , DAR AL NUZUM PUBLIC ACCOUNTANTS

current assets /current liabilities

Shafiulla Mohammad
by Shafiulla Mohammad , Customer Service Adviser , University of Bedfordshire

Current Ratio = Current Assets/ Current Liabilities. The answer is option1.

Muhammad Afaq
by Muhammad Afaq , SENIOR FINANCIAL ACCOUNTANT , United Eddy Company (United Yousef M. Naghi Group)

Option2.
It is most significant ones, which determine the company's ability to pay its debt on maturity.

Muhammad Yaseen Islam
by Muhammad Yaseen Islam , Accounts & Finance Manager , Alsale Eastern Company Ltd

Option one is the right answer.

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