Question

BSO, Inc. has current assets of $ 1,000,000 and current liabilities of $ 500,000, resulting in a cur-rent ratio of 2.0. For each of the following transactions, determine whether the current ratio will increase, decrease, or remain the same. Consider each item, (a)-(d), independent of the others.
a. Purchased $ 20,000 of supplies on credit.
b. Paid Accounts Payable in the amount of $ 50,000.
c. Recorded $ 100,000 of cash contributed by a stockholder for common stock.
d. Borrowed $ 250,000 from a local bank, to be repaid in 90 days.


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  • CreatedNovember 02, 2015
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