Which of the Following Events Will Cause a Company's Current

question 196

Multiple Choice

Which of the following events will cause a company's current ratio to decrease?

• A)The sale of inventory for cash
• B)The sale of inventory for credit (accounts receivable)
• C)Issuing stock for cash
• D)Paying off long-term debt with cash

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Definitions:

Budgeting

The process of creating a plan to spend your money, allowing for the allocation of funds to various areas.

Actual Results

The real financial outcomes achieved by a business over a period, which can be compared against budgeted or forecasted figures for analysis.

Personnel Expenses

Personnel expenses are costs associated with employing staff, including wages, benefits, and taxes.

Client-visits

Client-visits refer to the number of times clients visit a business or service provider, often used to measure customer engagement or service utilization.