Which of the Following Situations Will Improve the Current Ratio

question 25

Multiple Choice

Which of the following situations will improve the current ratio if it is initially less than 1.0?

• A)using cash to repay accounts payable
• B)purchasing inventory on credit terms
• C)selling finished goods inventory on credit
• D)purchasing marketable securities for cash

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Definitions:

Federalist Papers

A series of 85 essays written by Alexander Hamilton, James Madison, and John Jay promoting the ratification of the United States Constitution.

Ratification

The formal approval process of a treaty, constitutional amendment, or legislative act to make it officially valid.

Constitution

The fundamental principles and established precedents according to which a state or other organization is governed.

U.S. Constitution Ratified

The official confirmation and adoption of the United States Constitution by the required nine states in 1788, establishing the framework of the federal government.