Fundamental Accounting Principles -Hardcover
Fundamental Accounting Principles -Hardcover
22nd Edition
ISBN: 9780077862275
Author: John J Wild, Ken Shaw Accounting Professor, Barbara Chiappetta Fundamental Accounting Principles
Publisher: McGraw-Hill Education
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Chapter 4, Problem 13E
To determine

Concept Introduction:

Current Ratio:

Current Ratio means the ability to pay of the current debt. It is the proportion of Current Asset for Every Current Liabilities. If the current ratio is greater than 1 then it means firm’s current asset is greater than firm’s current liabilities. Current ratio is useful for the purpose of working capital loan.

  CurrentRatio=CurrentAssetCurrentLiabilities

TO CALCULATE:

We need to calculate the current Ratio as on balance sheet date. And also compare the current ratio with the Industry Average current ratio.

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Fundamental Accounting Principles -Hardcover

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