A company has current assets of \$500,000 and current liabilities of \$400,000. Calculate the current ratio and working capital.

• A. Current ratio: 1.25, Working capital: \$100,000
• B. Current ratio: 0.80, Working capital: \$900,000
• C. Current ratio: 1.50, Working capital: \$200,000
• D. Current ratio: 1.00, Working capital: \$500,000

Answer: (A)