Windham Corporation Has Current Assets of $660,000 and Current Liabilities

question 10

Multiple Choice

Windham Corporation has current assets of $660,000 and current liabilities of $825,000. Windham Corporation's current ratio would be increased by:

• A) the purchase of $360,000 of inventory on account.
• B) the payment of $360,000 of accounts payable.
• C) the collection of $360,000 of accounts receivable.
• D) refinancing a $360,000 long-term loan with short-term debt.

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Definitions:

Labor Force

The aggregate sum of individuals working or actively looking for work in an economic system.

Marginal Rate

The rate at which one variable changes as another variable changes by one unit, commonly used in the context of tax rates or marginal rate of substitution in economics.

Transformation

The process of changing the state, form, or structure of something, often seen in contexts ranging from technology to economics.

Production Possibility

Represents various combinations of amounts of two or more goods or services that can be produced within a given time period, with a given amount of resources, and with technology constraints.