Use the following information \(\begin{array}{c|c} & ₦ \\ \hline \text{Net profit} & 60,000\\ \text{Total assets} & 520,000\\ \text{Current liabilities} & 1...

Use the following information

\(\begin{array}{c|c} & ₦ \\ \hline \text{Net profit} & 60,000\\ \text{Total assets} & 520,000\\ \text{Current liabilities} & 150,000 \\ \text{Current assets} & 280,000 \end{array}\)
The current ratio is?

Answer Details

The current ratio is a financial ratio that compares a company's current assets to its current liabilities. It is used to measure a company's short-term liquidity or its ability to meet its short-term financial obligations. To calculate the current ratio, you divide current assets by current liabilities. In this case, the current assets is ₦280,000 and the current liabilities is ₦150,000. So, the current ratio is: Current Ratio = Current Assets / Current Liabilities Current Ratio = ₦280,000 / ₦150,000 Current Ratio = 1.87 : 1 Therefore, the answer is option A, which is 1.87 : 1.