The Current Ratio is a financial metric that measures a company's financial solvency or liquidity. Specifically, creditors often compare a firm’s current assets and current liabilities to assess whether the firm has sufficient working capital to meet its short-term needs.However, a high current ratio isn't always good, as it might indicate that the company is not efficiently using its assets to generate revenues.
Learn Current Ratio with interactive examples and practice exercises in our Performance Metrics module.
This interactive learning module helps you understand Current Ratio through hands-on practice and real-world examples.