Importance of current assets & liabilities

The Current Ratio which is defined as Current Assets/Current liabilities,  shows how sound the busines is being carried on by the organization.  A current ratio of 2 is the norm of the industry.  However this may differ depending upon the nature of the busines the organization is carrying on.  A current ration of2 means that the current assets should be twice your current liabilites.  if the ratio is less than two then the liquidity of the comapny is not well.