Formule Current Ratio. Current assets are resources that can quickly be converted into cash within a year's time or less. The current ratio formula divides the current assets of a company by its current liabilities.
Current ratio is a liquidity ratio which measures a company's ability to pay its current liabilities with cash generated current ratio is calculated using the following formula
The current ratio is a liquidity measure. The current ratio is a liquidity ratio that measures a company's ability to cover its. Current ratio = current assets / current liabilities. Understanding the current ratio formula is an important element of liquidity ratio analysis.
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