Which of the Following Statements Is CORRECT

question 51

Multiple Choice

Which of the following statements is CORRECT?

• A)A reduction in inventories would have no effect on the current ratio.
• B)An increase in inventories would have no effect on the current ratio.
• C)If a firm increases its sales while holding its inventories constant, then, other things held constant, its inventory turnover ratio will increase.
• D)A reduction in the inventory turnover ratio will generally lead to an increase in the ROE.
• E)If a firm increases its sales while holding its inventories constant, then, other things held constant, its fixed assets turnover ratio will decline.

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Definitions:

Assaulted

Being subjected to a sudden, violent attack or an attempt to cause physical harm to another person.

Defamation

The act of communicating false statements about a person, resulting in damage to that person's reputation or standing.

Reputation

The general belief or opinion that people have about someone or something based on past actions or performances.

Malicious Prosecution

A legal action wrongfully initiated against someone without proper grounds, with the intent of causing damage or distress.