Formula
Current Ratio
=
Current Assets
Current Liabilities
- Current Assets = Cash, receivables, inventory, and other assets expected to be converted within one year.
- Current Liabilities = Obligations due within one year: accounts payable, short-term debt, accrued expenses.
Alpha Finance
Current Value MRQ
Current Assets
—
Current Liabilities
—
Current Ratio
—
—
Current Ratio Drivers —
Table
| Year | Current Ratio |
|---|
Definition
The Current Ratio measures a company's ability to cover its short-term obligations with its short-term assets. A ratio above 1.5 is generally considered healthy, indicating the company has enough liquid resources to meet near-term liabilities. A ratio below 1.0 may signal liquidity risk. However, the ideal range varies by industry — capital-light businesses like tech or services can operate efficiently at lower ratios, while retail and manufacturing often need higher ones.
Strong≥ 1.5×
Adequate1.0 – 1.5×
Thin0.8 – 1.0×
Risky< 0.8×
AlphaAI Current Ratio Analysis
Powered by Alpha Finance
AI-powered insights will appear here...