Use the Following Data to Calculate the Current Ratio

question 74

Multiple Choice

Use the following data to calculate the current ratio.

• A) 2.34 : 1
• B) 2.80 : 1
• C) 3.31 : 1
• D) 1.26 : 1

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Definitions:

Net Fixed Assets

Refers to the value of a company's property, plant, and equipment minus depreciation, indicating the tangible assets' net book value used in operations.

Current Assets

Short-term assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business, whichever is longer.

Book Value Per Share

A financial measure that divides a company's book value by its number of outstanding shares, indicating the equity value per share.

Common Equity

The amount of funds contributed by shareholders plus the retained earnings within a company, representing ownership in the business.