What is the current ratio? The current ratio, sometimes referred to as the working capital ratio, is a metric used to measure a company's ability to pay its short-term liabilities, or those due ...

Another financial metric, the current ratio, measures the ratio of current assets to current liabilities. Unlike working capital, it uses different accounts in its calculation and reports the ...

For instance, a declining liquidity ratio may indicate deteriorating financial health or inefficient working capital management. However, it may also mean a company is trying to hold onto less ...