What effect would the following actions have on a firms current ratio? Assume that net working capital
Question:
What effect would the following actions have on a firm’s current ratio? Assume that net working capital is positive.
a. Inventory is purchased for cash.
b. A supplier is paid.
c. A bank loan is repaid.
d. A long-term debt matures and is paid.
e. A customer pays off an account.
f. Inventory is sold.
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a No change Both inventory and cash are current assets b Increase Both curren...View the full answer
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Related Book For
Essentials of Corporate Finance
ISBN: 978-1260013955
10th edition
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
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