Current assets to equity ratio (also known as current assets to proprietors’ fund ratio) shows the stockholders’ funds invested in current assets. The ratio may be expressed in proportion or percentage.
For example, suppose a company has current assets valuing $650,000 and stockholders’ equity $4,500,000. The current assets to equity ratio would be computed as follows:
= $650,000 / $4,500,000
= 0.14 or 14%