If the Current Ratio Is Currently Greater Than 1

question 45

Multiple Choice

If the current ratio is currently greater than 1.0, which one of the following events would increase the current ratio?

• A)Purchase of inventory on account
• B)Receipt of money from a customer prior to the performance of service
• C)Accrual of warranty expense
• D)Sale of plant asset at a gain

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Definitions:

Real Estate

Property consisting of land or buildings, including the transactions related to buying, selling, or renting it.

Marginal Benefit

The additional satisfaction or utility gained by consuming or producing one more unit of a good or service.

Marginal Cost

Marginal cost is the cost of producing one additional unit of a product, which varies depending on the level of production and can have a significant impact on pricing and production decisions.

Finance Professor

An academic expert specializing in teaching and research related to financial markets, instruments, and institutions.