Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor. Claire's expertise lies in corporate finance & accounting, mutual funds, ...

The current ratio is calculated by dividing a company’s current assets by its current liabilities. Ratios of 1 or higher indicate short-term solvency.

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Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems. David Kindness is a Certified Public Accountant (CPA) and an expert ...

There’s no universal safe or danger level. Ideal current ratios vary by industry. A current ratio of 1.0 means the company has $1 in current assets for every $1 in current liabilities. A ratio below 1 ...

Liquidity ratios are important financial metrics that can determine whether a company can pay off its short-term debts without having to raise more capital. One of these ratios is the current ratio, ...

Current ratio measures short-term asset coverage of liabilities, guiding investment decisions. Compare a company's current ratio across years and versus peers to assess financial health. Seasonal ...