A company with $60,000 in current assets and $40,000 in current liabilities pays a $1,000 current liability.

Fantastic news! We've Found the answer you've been seeking!

Question:

As a result of this transaction, the current ratio and working capital will

a. decrease.

b. both increases.

c. increase and remain the same, respectively.

d. remain the same and decrease, respectively

Related Book For answer-question

Advanced Accounting

ISBN: 978-0134472140

13th edition

Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith

See More Books

Posted Date: Jun 15, 2022 06:14 AM

See More Questions

The Nelson Company has $1,812,500 in current assets and $625,000 in current liabilities. Its initial inventory level is $437,500, and it will raise funds as additional notes payable and use them to...
The Nelson Company has $1,312,500 in current assets and $525,000 in current liabilities. Its initial inventory level is $375,000, and it will raise funds as additional notes payable and use them to...
The Petry Company has $1,312,500 in current assets and $525,000 in current liabilities. Its initial inventory level is $375,000, and it will raise funds as additional notes payable and use them to...
Muskoka Boys Shaving Co. (MBSC") is a GST/HST registrant operating an online store in Ontario's cottage country region. The company specializes in selling fine grooming products for men. It is June...
On December 31, 2012, Tran Co. performed environmental consulting services for Hayden Co. Hayden was short of cash, and Tran Co. agreed to accept a $100,000 zero-interest-bearing note due December...
Messer Company purchased equipment for $24,000. The company is considering whether t o determine annual depreciation using the straight-line method or the declining-balance method at 150 percent of...
Estimate average particle diameter, mass transfer coefficients, and mixer stage efficiency for extraction of benzoic acid from water into toluene for Example 13-7. Example 13-7 Design a baffled...
Better Experts Ltd. (BEL) specializes in taking underperforming companies to a higher level of performance. BELs capital structure at December 31, 2011, included 10,000 shares of $2.25 preferred...
Presented below is information for DBH INC. 1. Beginning of the year Accounts Receivable balance was 20,200. 2. Net sales (all on account) for the year were 106,200. DBH Inc does not offer cash...
A fertilizer manufacturing company wants to relocate to Lakeside County. A report from a fired researcher at the company indicates the companys product is releasing toxic by-products. The company...
A carbon atom is most likely to form what kind of bond(s) with other atoms?
Digitel is a mobile devices company. Unit sale price if the mobile device is $84 and the unit variable cost is $24. The accounting break-even and the financial break-even points of Digitel are...
If current assets are $ 50,000, total essets $400,000, current liabilities $20,000, total liabilities 100,000 and revertues $1000,000. The total Non- current liabilities is ?
What is the output of the following snippet? def fun(x): if x % 2 == 0: return 1 else: return 2 print(fun(fun(fun(2))))
calculate How many shares plan to be sold? Per Share Total Price to Public 20.42 204,200,000.00 Underwriting Discounts and Commissions 1.07 10,700,000.00 Proceeds to Company 19.35
Fixed costs are $900000 and the unit variable costs are 60% of the unit selling price. What is the break-even point in sales dollars?
The product line manufacturing electric motor has seven stations. The individual capacity of the critical station is limited to 1000 units per week. If, the actual output of the product line is 800...
In the figure, two loudspeakers, separated by a distance of d1 = 2.63 m, are in phase. Assume the amplitudes of the sound from the speakers are approximately the same at the position of a listener,...
On June 15, 2016, Malmo City authorizes the issuance of $500,000 par of 6 percent serial bonds to be issued on July 1, 2016, and to mature in annual serials of $100,000 beginning on July 1, 2017. The...
Pam Corporation purchased a block of Sun Company common stock for $1,040,000 cash on January 1, 2016. Separate-company and consolidated balance sheets prepared immediately after the acquisition are...
What is the accounting equation for a governmental fund?
Derive Eq. (14-14) and the form of this equation if the system is very dilute. Y = (Fsolid/Fsolv) X+Y-(Fsolid /Fsolv)X0
Because the feed underflow in Example 14-1 was not the same as in the other stages, we had to do the feed stage calculation separately, but connected to, the calculation for the remainder of the...
Derive Eq. (14-15a) and the corresponding equation for $\mathrm{x}_{\mathrm{D}, \mathrm{M}}$. (14--15a) XA.M EOYA,0 + FXA,N+1 EO+F 0+(1000) (0.2) 662+1000 = 0.120

A company with $60,000 in current assets and $40,000 in current liabilities pays a $1,000 current liability.

Question:

Expert Answer:

60000 Existing current ratio 15 40000 Existing working cap... View the full answer

Advanced Accounting

Students also viewed these finance questions