Question

Feiler Corporation has total current assets of $493,000, total current liabilities of $357,000, total stockholders' equity of $1,067,000, total net plant and equipment of $1,041,000, total assets of $1,534,000, and total liabilities of $467,000. The company's current ratio is closest to:

a.0.76

b.1.06

c.1.38

d.2.23

Answer 1

Answer:

The answer is C.

Explanation:

Current ratio shows the liquidity of of a company. This ratio tells us how a company or business is able to meet its short obligation.

This ration is very important to lenders because they use it to know of you will be able to meet the interest payment and principal

The formula for current ratio is:

Current assets/current liabilities

Total current assets is $493,000, Total current liabilities is $357,000

= $493,000/$357,000

=1.38