A Firm Has $600,000 in Current Assets and $150,000 in Current

question 90

Multiple Choice

A firm has $600,000 in current assets and $150,000 in current liabilities.Which of the following is correct if it uses cash to pay off $50,000 in accounts payable?

• A) Current ratio will increase to 5.0.
• B) Net working capital will increase to $500,000.
• C) Current ratio will decrease.
• D) Net working capital will not change.

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Definitions:

Social Self

The social self refers to the part of an individual's self-concept that is derived from their interactions with others and the perception of being part of a community.

Self-Discrepancy Theory

A model linking the distance between the actual self and the ought and ideal selves to emotion.

Self-Concept

The mental image or perception that one has of oneself, encompassing beliefs, feelings, and thoughts about one's abilities, appearance, and values.

Self-Efficacy

A belief in one's ability to succeed in specific situations or accomplish a task, which can play a major role in how goals, tasks, and challenges are approached.