The calculation formula of current ratio is: current ratio = current assets/current liabilities, that is, the ratio of current assets to current liabilities. For example, if a listed company has current assets of 60 million and current liabilities of 30 million, its current ratio = 60 million/30 million =2.

The current ratio is used to measure the ability of an enterprise's current assets to be converted into cash to repay its liabilities before the short-term debt expires. Generally speaking, the higher the current ratio, the stronger the liquidity of enterprise assets and the stronger the short-term solvency; Conversely, the lower the current ratio, the lower the liquidity of enterprise assets and the lower the short-term solvency.