calculate_current_ratio
Calculate the current ratio, a liquidity measure of whether a company can cover its short-term obligations (due within a year) with its short-term assets. Formula: Current Ratio = Current Assets / Current Liabilities. WHEN TO USE: Use to assess short-term solvency, compare liquidity across peers of different sizes, or screen for distress risk. WHEN NOT TO USE: Do NOT use as the sole liquidity measure — it ignores asset quality and timing of cash flows (use calculate_quick_ratio or calculate_cash_ratio for stricter views). BEHAVIOUR: pure deterministic calculation — no side effects, no network or storage access; idempotent and non-destructive; identical inputs always produce identical outputs. Division by zero or non-finite inputs returns an explicit error instead of a number. RETURNS: JSON object { current_ratio: number (e.g. 1.8 = 1.8x), inputs }. PARAMETERS: current_assets (required): Total current assets, e.g. 500000. Must be >= 0. current_liabilities (required): Total current liabilities, e.g. 280000. Must be > 0.
Input Schema
| Name | Required | Description | Default |
|---|---|---|---|
| current_assets | Yes | Total current assets, e.g. 500000. Must be >= 0. | |
| current_liabilities | Yes | Total current liabilities, e.g. 280000. Must be > 0. |