The financial index which compares current assets directly with current liabilities is known as current

Answer Details

The financial index which compares a company's current assets directly with its current liabilities is known as the current ratio. It is a measure of a company's liquidity or ability to pay its short-term debts using its short-term assets. The current ratio is calculated by dividing the company's current assets by its current liabilities. A ratio of 1 or higher indicates that the company has sufficient current assets to cover its current liabilities, while a ratio of less than 1 indicates that the company may have difficulty paying its short-term debts. The current ratio is an important financial metric that is closely watched by investors, analysts, and creditors to assess a company's financial health and ability to meet its short-term obligations.