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Finra Series-7 Exam - Topic 3 Question 6 Discussion

A large manufacturing company has current assets of approximately $9,400,000 and current liabilities of about $4,900,000.Which of the following statements is true about the current ratio?
B) it is somewhat below the standard minimum
A) it is substantially below the standard minimum
C) it is about the standard minimum
D) it is somewhat above the standard minimum

Finra Series-7 Exam - Topic 3 Question 6 Discussion

Actual exam question for Finra's Series-7 exam
Question #: 6
Topic #: 3
[All Series-7 Questions]

A large manufacturing company has current assets of approximately $9,400,000 and current liabilities of about $4,900,000.

Which of the following statements is true about the current ratio?

Show Suggested Answer Hide Answer
Suggested Answer: B

it is somewhat below the standard minimum. The standard minimum current ratio for a manufacturing company is 2 to 1. The current ratio for this company is 1.92 (9,400,000 divided by 4,900,000).


by Claribel at May 05, 2022, 12:46 AM

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Mabelle
9 months ago
Wait, are we sure those numbers are accurate?
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Benton
10 months ago
Not sure, but it seems pretty healthy to me.
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Gerry
10 months ago
I think that's actually above the standard minimum.
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Krystina
10 months ago
That gives a current ratio of about 1.92!
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Barb
10 months ago
Current assets are $9.4M and liabilities are $4.9M.
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Merri
10 months ago
I feel like this current ratio is probably okay, but I can't recall if "somewhat above" means it's safe or just acceptable.
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Coleen
11 months ago
I practiced a similar question where the current ratio was below 1, and I think that was considered risky.
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Alverta
11 months ago
I think the standard minimum for a current ratio is around 1.0, so with those numbers, it might be just above that.
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Glenn
11 months ago
I remember the current ratio is calculated by dividing current assets by current liabilities, but I'm not sure what the standard minimum is.
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Kami
11 months ago
Okay, let's see here. I think the key is to make sure the reports are accessible within the model-driven app. Sharing and adding them to the site map seem like good options to explore.
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Izetta
11 months ago
Okay, I think I know the answer to this. Let me double-check my understanding before selecting an option.
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