Business and Economics Reporting
The current ratio is a financial metric that measures a company's ability to pay its short-term liabilities with its short-term assets. It is calculated by dividing current assets by current liabilities, providing insight into the liquidity and operational efficiency of a business. This ratio is vital in assessing financial health and is closely tied to financial statements, revealing how well a company can cover its immediate debts using available resources.
congrats on reading the definition of current ratio. now let's actually learn it.