For each of the following transactions, indicate whether it increases, decreases, or has no effect on the following financial ratios: current ratio, debt-to-equity ratio, profit margin ratio, and return on equity.
Assume the current ratio and debt-to-equity ratio are greater than one and the profit margin ratio and return on equity are less than one before each of the entries is considered. Consider each transaction independently.
a. Collection of an amount owed by a customer.
b. An expense paid in cash.
c. Payment of an amount owed to a supplier
d. Declaration and payment of a dividend.

  • CreatedFebruary 26, 2015
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