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:

Hypersensitive

Excessively sensitive either emotionally or in physical response to external stimuli.

Criticism

The expression of disapproval of someone or something based on perceived faults or mistakes.

Hyperactive

Characterized by more active, energetic behavior than what is typically observed, often referring to ADHD symptoms.

Odd Cognition

A term not widely recognized in traditional psychological or medical terminology, potentially referring to unusual or atypical thought processes.