Definitions for

**"current ratio"****Related Terms:**Liquidity ratios, Acid test ratio, Quick ratio, Liquidity ratio, Acid-test ratio, Acid test, Working capital, Net current assets, Capital ratio, Equity ratio, Net working capital, Debt to equity ratio, Financial ratios, Solvency ratio, Total debt to total assets, Net quick assets, Non-current asset, Total assets, Leverage ratio, Capital employed, Non-current assets, Quick assets, Debt-equity ratio, Net worth, Net assets, Debt / equity ratio, Debt/equity ratio, Other current liabilities, Net worth statement, Other assets, Other current assets, Net debt, Current assets, Financial leverage, Capital adequacy ratio, Current asset, Debt-to-equity ratio, Accounting equation, Total liabilities, Balance sheet, Solvency, Long-term assets, Balance sheet equation, Leverage ratios, Nta, Roic, Owner's equity, Net tangible assets, Total asset turnover

An indication of a companys ability to meet short-term debt obligations; the...

An accounting ratio, usually defined as current assets divided by creditors falling due within one year. The ratio is designed to assess the solvency of a company in the short term. If the current ratio exceeds one, then the value of current assets is greater than the value of the short term creditors, indicating that the company is able to pay its short term debts as they fall due. Note that this interpretation is fairly simplistic.

This ratio tells you of how easily your business can meet its debts. To calculate the Current Ratio for your business, simply divide your current assets by your current liabilities (the higher the ratio, the better for your business!).

A company's current assets divided by its current liabilities. It is a measure of a company's liquidity.

A test of liquidity showing the difference between current assets and current liabilities. See also Quick Ratio.

A financial liquidity measure that divides current assets by current liabilities, with higher ratios indicating a more stable short-term position.

or working capital ratio - measures liquidity, and is current assets divided by current liabilities.

A measure of liquidity that shows a company's ability to pay its short-term debts. Current Ratio = (Current assets / Current liabilities) = Number of times covered

The ratio of errors measured during the last ten seconds. Applies to bit error and bipolar violation ratios.

A measure of whether a company is able to meet its short-term liabilities. The higher the ratio, the more secure the company is. The Current Ratio is calculated by dividing the total of Current Assets by Current Liabilities. You can find these figures in the company's balance sheet.

Current assets divided by current liabilities. It shows to what extent a company's current assets cover its current liabilities. However, for a more accurate picture, it is preferable to compute the inventory holding and collection periods.

Current Asset divided by Current Liabilities. Measures a company's cash flow and indicates their ability to meet its short-term debts.

This represents the number of times the business short term assets cover its current liabilities. It measures the ability to meet its day to day commitments.

The current ratio is a test of a company`s financi... more

Indicates the extent to which the claims of short-term creditors are covered by assets that are expected to be converted to cash in a period roughly corresponding to the maturity of liabilities (one year). Current Ratio = Current Assets / Current Liabilities

A measure of liquidity, the current assets divided by the current liabilities.

A measurement of liquidity, calculated by dividing total current assets by total current liabilities. Debenture A long-term corporate bond, bearing fixed interest and often unsecured, issued by a company or government agency; assets may be pledged as security.

Current Assets / Current Liabilities The ratio signifies the short-term liquidity of the company. The higher the ratio, stronger is the short term liquidity position of the company.

a measure of debt paying ability, current assets divided by current liabilities.

A ratio expressing the relationship between current assets and current liabilities.

Current assets divided by current liabilities--a metric of liquidity. The higher the ratio (assuming current assets are liquid) the greater the cushion between current obligations and a business's ability to meet them.

A measure of a company's financial strength, based on how many dollars in assets can be converted to cash within one year in order to pay debts that will come due during the same year. What's a “good” current ratio depends on the specific business and its industry, but a very general rule of thumb is to target a current ratio of at least 2.0. Note that, at some point, too high a current ratio might indicate a financial problem as well.

Current assets divided by current liabilities. This ratio is a measure of a company's ability to meet its financial obligations in a timely manner.

A comparison of an organization's current assets to its current liabilities; indicates the ability to pay bills and meet financial obligations. See also current assets and current liabilities.

Current assets divided by current liabilities -- a measure of liquidity. Generally, the higher the ratio, the greater the "cushion" between current obligations and a firm's ability to meet them.

The current assets of a company divided by its current liabilities. Balance-sheet strength indication.

Calculated by dividing the total current assets for a given period by the total current liabilities for the same period.

The ratio between the current financial resources and current liabilities. The ratio 1:1 or higher means, that financial resources which can be received within one year from the assets, cover all liabilities for the year.

a financial ratio obtained by dividing current assets by current liabilities. Used to measure the liquidity of a business.

the sum of current assets divided by the sum of current liabilities.

relation of current assets to current liabilities

A ratio of a firm's current assets to its current liabilities. The current ratio includes the value of inventories which have not yet been sold, so it is not the best evaluation of the current status of the firm. The "acid test" ratio, covering the most liquid of current assets, provides a better evaluation.

Refers to the amount of an entity's current assets divided by the amount of current liabilities.

The sum of current assets divided by current liabilities, which measures how well current assets cover current liabilities. This is regarded as an important measure of current liquidity. Investors generally look for a ratio of two-to-one or better when looking for good quality companies.

The ratio achieved by dividing Current Assets by Current Liabilities. It tells us if the organisation is able to pay off its debts within 12 months.

Current Ratio = Total Current Assets/Total Current Liabilities. The current ratio shows a company's financial solvency.

Current assets divided by current liabilities. Current liabilities include short term borrowings and interest free liabilities other than deferred taxation.

equals Total Current Assets divided by Total Current Liabilities. The current ratio indicates the amount of liquid assets available to pay off current liabilities or the company's ability to pay its bills and meet its current obligations. Generally, the higher the current ratio is, the greater the company's liquidity.

An indicator of a company`s ability to pay short-term obligations. It is calculated by dividing current assets by current liabilities.

This is the ratio of Total Current Assets for the most recent quarter divided by Total Current Liabilities for the same period.

Current assets, including cash, accounts receivable and inventory, divided by current liabilities, including all short-term debt. A rough measure of financial risk: the smaller current assets relative to current liabilities,the greater the risk of credit failure.

a commonly used method of measuring a firm's short term solvency by indicating its ability to pay current debts from current assets. Current ratio is calculated by dividing current assets by current liabilities.

The ratio of current assets to current liabilities.

A test of a corporation's liquidity--that is, a corporation's ability to pay its current obligations from current assets. The ratio is calculated by dividing current assets by current liabilities. See: Acid Test Ratio; Current Assets; Current Liabilities; Liquidity Ratio; Quick Asset Ratio

Shows the firm's ability to pay its current obligations from current assts. Current assets divided by current liabilities.

The worth of a company (contained as current assets, including cash, accounts receivable and inventory,) divided by current financial liabilities, including all short-term debts (This ratio roughly measures a company's financial risk: logically, the more the financial liabilities, the riskier the company. Thus, small current ratios indicate high risk.)

Current assets divided by current liabilities. Back to main document.

current assets divided by current liabilities. A current ratio of 2 usually assures that the claims of short term creditors are covered by short term assets.

The ratio of current assets to liabilities. Also called "quick ratio."

The ability to meet short-term debts.

A test of a corporation's liquidity. It is found by dividing current assets by current liabilities.

Ratio of all current assets to current liabilities. This is one of the liquidity financial ratios used to look at your working capital and measure short-term solvency.

Current Ratio measures the business' ability to meet obligations that are coming due soon such as payments to suppliers or taxes. Current ratio is derived by dividing current assets by current liabilities. Current ratio is particularly useful as an early

A ratio of a business' current assets to its current liabilities. Debt financing. The use of borrowed money to finance a business.

The ratio obtained by dividing current assets by current liabilities to measure ability of the firm to pay short-term debt from readily available funds.

Indicator of short-term debt paying ability. Determined by dividing current assets by current liabilities. The higher the ratio, the more liquid the company.

The current ratio provides a speedy indication of a company's ability to meet short-term debt obligations. The higher the ratio, the more liquid the company is, and the better able it is to take care of any short-term debt. To determine the ratio, take current assets and divide by current liabilities.

Current assets divided by total current liabilities, an indication of a companyâ€™s ability to meet its short-term obligations.

An indication of credit worthiness derived by dividing the book value of total current assets by the book value of total current liabilities

A liquidity ratio calculated as current assets divided by current liabilities.

indicates the working capital strength of the enterprise. It is an indication of the enterprise's ability to meet its obligations and expand its business. It is calculated by total current assets divided by total current liabilities. (Current Assets / Current Liabilities) Page 329

Current Assets divided by Current Liabilities, a measure of liquidity, or the ability to pay current debts out of current assets. An extreme version, the "Acid Test" ratio, assumes Inventory cannot be converted to cash.

An indication of the businessâ€™ ability to fund current liabilities with current assets. The ratio is defined as: Current Assets/ Current Liabilities. The higher the ratio, the greater the businessâ€™ ability to fund current liabilities with current assets.

A company's current assets divided by its current liabilities. A measure of balance sheet strength.

Current assets divided by current liabilities; also known as working capital ratio.

A measure of a company's liquidity, or its ability to pay its short-term debts. Calculated by dividing current assets by current liabilities. Current assets at least twice current liabilities is considered a healthy condition for most businesses.

Also known as Working Capital Ratio. A measure of liquidity of business. Equal to current assets divided by current liabilities.

Total current assets divided by total current liabilities. This ratio shows the dollar amount of current assets per dollar of current liabilities. It is a gross indicator of the facility’s liquidity. Usually, a ratio of 2.0 or more indicates a healthy liquidity position.

A comparison of current assets to current liabilities, calculated by dividing your current assets by your current liabilities. This ratio will be particularly important to you if you're thinking of borrowing money or getting credit from one of your suppliers. Potential creditors use this ratio to measure a company's liquidity or ability to pay off short-term debts. Though acceptable ratios vary from industry to industry, a current ratio of 2:1 is considered the norm.

A financial ratio of current assets to current liabilities. See liquidity ratios. Daylight Credit (or Daylight Overdraft, Daylight Exposure, Intra-day Credit) An intra-day exposure of a bank when an account is in an overdraft position at any time during the business day. Conversely, for the account holder it is a credit extended for a period of less than one business day. Daylight credit may be extended by central banks to even out mismatches in the settlement of payments. In a credit transfer system with end-of-day final settlement, daylight credit is tacitly extended by a receiving institution if it accepts and acts on a payment order, even though it will not receive final funds until the end of the business day.

The balance of current assets against current liabilities.

A ratio that divides a company's current assets by its current liabilities to measure its short-term debt-paying ability.

Represented by current assets divided by current liabilities, and indicative of the company’s ability to pay off its short term-debts.