Questions: Knowledge Check 01 The balance sheet of Ambiance Corporation reported current assets of 186,708, total assets of 300,000, current liabilities 36,139, and total liabilities of 125,000. What is the company's current ratio? Note: Round your answer to 2 decimal points.

To calculate the current ratio, we use the formula:

\[ \text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}} \]

Given:

• Current Assets = \$186,708
• Current Liabilities = \$36,139

Plug these values into the formula:

\[ \text{Current Ratio} = \frac{186,708}{36,139} \]

Now, perform the division:

\[ \text{Current Ratio} \approx 5.17 \]

Therefore, the company's current ratio is approximately 5.17. This means that Ambiance Corporation has \$5.17 in current assets for every dollar of current liabilities.