The Current Ratio Measures

question 134

Multiple Choice

The current ratio measures:

• A)the amount of total assets available to the business currently.
• B)a company's ability to pay current liabilities with its total assets.
• C)a company's ability to pay current liabilities with current assets.
• D)a company's profitability during a particular period.

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Definitions:

Internal Control

Processes and procedures implemented by an organization to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.

External Control

Refers to the belief that one's behavior and outcomes are influenced or dictated by external forces beyond one's personal control.

Interactional Psychology

The psychological approach to understanding human behavior that involves knowing something about the person and about the situation.

Environmental Influences

External factors surrounding an individual or system that affect its development, behavior, or operations.