Exam 6: The Current Asset Classification, Cash, and Accounts Receivable

Maradonna Co. uses an aging schedule of accounts receivable in estimating its bad debt expense. The total estimate, which appears on the aging schedule, will be equal to

Under the direct write-off method of accounting for bad debts, the recognition of bad debts expense

Use the information that follows concerning the current assets and current liabilities of Ryan Company at December 31, 2010, to answer problems 3 through 8. Each problem is independent of the others. -How would the current ratio be affected if Ryan collects the accounts receivable and then uses some of the cash to pay off the accounts payable?