The current ratio is 2: 1, which means that current assets are twice as large as current liabilities. Even if half of current assets cannot be realized in a short period of time, all current liabilities can be guaranteed to be repaid.
The formula of current ratio is current ratio = total current assets/total current liabilities * 100%.
The current ratio is used to measure the ability of an enterprise to convert its current assets into cash to repay its liabilities before the short-term debt expires. Although the higher the current ratio, the greater the liquidity of enterprise assets, but the excessive ratio shows that the current assets occupy more, which will affect the turnover efficiency and profitability of working capital.
Extended data
Both current ratio and quick ratio are used to express the liquidity of funds, that is, the short-term solvency of enterprises. The benchmark value of the former is 2, and the latter is 1.
Quick assets include monetary funds, short-term investments, bills receivable, accounts receivable and other receivables, which can be realized in a short time. /kloc-Inventory in current assets and non-current assets due within 0/year should not be included.
The relationship between current ratio, quick ratio and cash ratio;
1, the current liabilities are paid based on all current assets, and the calculated index is the current ratio;
2. Pay the basis of current liabilities and make up for the deficiency of current ratio;
3. Cash ratio is to pay current liabilities with cash assets (monetary funds+transactional financial assets), but excessive cash holdings have a negative impact on the asset utilization effect of enterprises. This indicator is only used when enterprises are facing financial crisis, and its strength is relatively small compared with current ratio and quick ratio.
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