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6. 6 If a current ratio is lower than the following can the company be considered in risk of bankruptcy? a) 1 b) 2 c) 1.14 D) None of the above 7. Revenues are only recorded when completed ? A) True B) False 8. 8 When cash is sent to a supplier in payment for an account payable, how are the elements of the accounting equation affected? A) Decrease assets (cash and decrease liabilities (accounts payable) B) Increase assets (cash) and decrease assets (accounts receivable) C) Increase assets and increase liabilities D) Increase assets and increase equity E) None of the above 9. 9 The investment of cash in the business by an investor will result in which of the following? A) An increase in cash and a decrease in equity and increase in liabilities B) An increase in cash and an increase in equity C) A decrease in cash and an decrease in liabilities D) An increase in fees eamed and an increase in equity 10 Assets total $1,000,000 and liabilities total $320,000. What is the equity of the business? a) $1,320,000 b) $800,000 c) $680.000 e) None of the above