If a company’s ratio lingers significantly below 1 for a long time, however, this may indicate a problem with the business’ short-term solvency. The current ratio is calculated by dividing the ...

meaning the company has at least enough assets to pay off its short-term obligations. How to interpret the current ratio Some companies in specific industries may have a current ratio below 1 ...

The quick ratio compares the value of a company's most liquid assets to the value of its current liabilities so ... a ratio of slightly below 1 (e.g., 0.92) isn’t necessarily cause for alarm ...