Which of the Following Statements About the Current Ratio Is

question 17

Multiple Choice

Which of the following statements about the current ratio is NOT true?

• A) The current ratio indicates whether the company has enough short-term assets to cover its short-term debts.
• B) An extremely high ratio is always a favourable sign.
• C) A ratio above 1 indicates that working capital is positive.
• D) The current ratio is calculated as current assets divided by current liabilities.

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Unconditional Positive Regard

An attitude of acceptance and respect on the part of an observer, no matter what a person says or does.

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Acceptance and love that are contingent upon the individual behaving in certain ways or meeting particular standards.

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Dimensions

Measurements in terms of length, width, height, or depth that define the size, shape, or extent of something.