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      Question

      In accounting and financial statement analysis, what is

      generally considered the ideal or standard Current Ratio to indicate a company has sufficient short-term liquidity?
      A 0.5 : 1 Correct Answer Incorrect Answer
      B 1 : 1 Correct Answer Incorrect Answer
      C 1.33 : 1 Correct Answer Incorrect Answer
      D 2 : 1 Correct Answer Incorrect Answer
      E 3 : 1 Correct Answer Incorrect Answer

      Solution

      A current ratio of 2:1 is traditionally considered ideal, meaning the company has twice as many current assets as current liabilities to cover its short-term obligations safely.

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