Harry's Home Services Has Current Liabilities of $450,000, Current Assets

question 67

Multiple Choice

Harry's Home Services has current liabilities of $450,000, current assets of $500,000, and profits of $80,000. Which of the following is the current ratio for Harry's business?

• A) 0.17
• B) 0.9
• C) 1.11
• D) 16

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Definitions:

Return on Assets

A financial ratio indicating the profitability of a company relative to its total assets, measuring how effectively a company uses its assets to generate earnings.

Liabilities

Financial obligations or debts that a company or individual owes to others.

Expenses

Costs incurred in the process of generating revenue, including operating expenses, cost of goods sold, and other overheads.

Accounting

The systematic process of recording, analyzing, summarizing, and reporting the financial transactions of a business or individual.