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If a Company Has a Current Ratio of 1

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If a company has a current ratio of 1.3:1, what effects will the borrowing of cash by short-term debt and collection of accounts receivable have on the ratio? If a company has a current ratio of 1.3:1, what effects will the borrowing of cash by short-term debt and collection of accounts receivable have on the ratio?


Definitions:

Discretionary Accruals

Accounting adjustments made by management's judgment, often to smooth out earnings or manipulate financial statements.

Increase Income

A financial objective focused on enhancing the amount of earnings generated by an individual or entity.

Managerial Strategies

Approaches and plans implemented by management to achieve organizational goals and improve company performance.

Stock Prices

Stock prices represent the current market price for a share of a company's stock, reflecting the value that the market places on the company's future financial prospects.

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