All Else the Same, Which of the Following Occurs When

question 310

Multiple Choice

All else the same, which of the following occurs when a firm buys inventory with cash?

• A) The quick ratio goes up if it was greater than one before the change.
• B) The current ratio goes down if it was greater than one before the change.
• C) The current ratio goes down if it was lower than one before the change.
• D) The quick ratio goes up if it was lower than one before the change.
• E) The quick ratio declines but the current ratio remains unchanged.

Determine conditions under which a corporation can purchase, redeem, or otherwise acquire its own shares.

Recognize the rights conferred by ownership of shares in a corporation.

Gain knowledge of the historical context and significance of federal statutes regulating securities.

Understand the use and variations of stock options within corporate structures.