All of the Following Regarding Current Ratio Are Except

question 50

Multiple Choice

All of the following regarding current ratio are except:

• A) Current ratio is calculated by dividing current assets by current liabilities.
• B) Current ratio helps to assess a company's ability to pay its debts in the near future.
• C) Current ratio does not affect a creditor's decision on when to allow a company to buy on credit.
• D) Current ratio can affect a creditor's decision about whether to lend money to a company.
• E) Current ratio can reveal problems in a company if it is less than 1.

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