Other Things Held Constant, Which of the Following Will Not

question 22

Multiple Choice

Other things held constant, which of the following will not affect the current ratio, assuming an initial current ratio greater than 1.0?

• A) Fixed assets are sold for cash.
• B) Long-term debt is issued to pay off current liabilities.
• C) Accounts receivable are collected.
• D) Cash is used to pay off accounts payable.
• E) A bank loan is obtained, and the proceeds are credited to the firm's checking account.

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Definitions:

Unreasonable Demands

Requests or expectations that are excessive, unrealistic, or impossible to satisfy.

Review Process

A systematic examination or assessment of something with the potential for feedback or revision, often used in academic, professional, or organizational contexts.

Suppliers

Businesses or individuals that provide goods or services to another entity, typically within a supply chain.

Proposal Process

The steps involved in preparing and submitting a proposal, typically including drafting, reviewing, and approval stages.