Essay
State the effect of the following transactions on the current ratio. Use increase, decrease, or no effect for your answer.
(a) Collection of an accounts receivable
(b) Declaration of cash dividends
(c) Additional stock is sold for cash
(d) Accounts payable are paid
(e) Equipment is purchased for cash
(f) Inventory purchases are made for cash
(g) Temporary investments are purchased for cash
Correct Answer:
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(a) no effect
(b) de...View Answer
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Correct Answer:
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(b) de...
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