What does a current ratio of 1.20:1 mean? For every $1.20 of current...

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Accounting

What does a current ratio of 1.20:1 mean?
For every $1.20 of current liabilities, a company has $1.20 of current assets.
For every dollar of current liabilities, a company has $1.00 of current assets.
For every $1.20 of current liabilities, a company has $1.00 of current assets.
For every dollar of current liabilities, a company has $1.20 of current assets.
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