Question: 10. (LO 23.4) What changes will occur if an inventory policy change causes a firm to hold less inventory? a. The current ratio and the

10. (LO 23.4) What changes will occur if an inventory policy

10. (LO 23.4) What changes will occur if an inventory policy change causes a firm to hold less inventory? a. The current ratio and the quick ratio will both decrease. b. The current ratio will decrease but the quick ratio will be unchanged. c. The inventory turnover ratio will decrease. d. The average days revenues in inventory (ADRI) will increase. 11. (LO 23.4) What changes will occur if a payment policy change causes a firm to pay its suppliers faster? a. The current ratio and the quick ratio will both decrease. b. The current ratio will increase, but the quick ratio will be unchanged. c. The payables turnover ratio will decrease. d. The average days of revenues in payables (ADRP) will decrease. 12. (LO 23.4) What changes will occur if a credit policy change causes a firm to allow its customers more time to pay their invoices? a. The current ratio and the quick ratio will not change as accounts receivable changes to cash. b. The current ratio will increase but the quick ratio will be unchanged. c. The receivables turnover ratio will increase. d. The average collection period (ACP) will decrease

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