Jill's Business Has Current Assets of $50,000 and Current Liabilities

question 23

Multiple Choice

Jill's business has current assets of $50,000 and current liabilities of $25,000.Which statement is true about the company's current ratio?

• A)The ratio is 50% and is acceptable for most industries.
• B)The ratio is 2 and is acceptable for most industries.
• C)The ratio is $25,000 and is not acceptable for most industries.
• D)Current ratio can not be determined from the information given.

---

Definitions:

Purely Competitive

A market structure characterized by many buyers and sellers, freely entering and exiting the market, with all firms selling identical or nearly identical products.

Unit Price

The cost per unit of a product or service, making it easier to compare the value of similar items.

Market Price

The current market price for buying or selling an asset or service in an open exchange.

Purely Competitive

A market structure characterized by many buyers and sellers, homogeneous products, and free entry and exit of firms.