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what is current ratio formula

Answer Posted / sanmilan

The answer is same as above i.e.
Current Ratio = Current Assets/Current Liabilities
The higher the current ratio, the more capable the company
is of paying its obligations.The desirable ration is '1'.
A lower ratio shows poor Financial Condition of the
Organization and needs attention to probe into the causes
and remedial actions. It also indicates that additional
Financing would be needed to run the Organization.
More attention to be given on the 'Receivables' as well as
Dead Investments, Bad Investments as well as Credit Policies.

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