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Andrew Bloomenthal has 20+ years of editorial experience as a financial journalist and as a financial services marketing writer. David Kindness is a Certified Public Accountant (CPA) and an expert in ...

The current ratio is calculated by dividing a company’s current assets by its current liabilities. Ratios of 1 or higher indicate short-term solvency.

Understand what the current ratio measures, why it matters, and how to use it to assess and improve short-term liquidity. There’s no universal safe or danger level. Ideal current ratios vary by ...