Determine the effect that each of the following transactions have on Leon€™s current ratio and debtto-equity ratio. Indicate whether the transaction increases, decreases, or has no effect on each ratio. On December 31, 2011 Leon€™s current ratio was 2.47 and its debt-to
equity ratio was0.40.

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Effect on the Effect on the debt- current ratio t-equity ratio Transaction 1. Furniture is sold to customers for cash. 2. Leon's borrows $10 million. The loan must be repaid in ten years. 3. Cash is paid to settle an account payable 4. Inventory is purchased on credit. 5.New display cases are purchased on credit. Payment is due 30 days. 6. Display cases are purchased for cash 7. Employee wages are paid in cash. 8. A cash dividend is paid. 9. Common shares are sold to investors for cash.