Assume the Current Ratio Is 3 to 1

question 146

Multiple Choice

Assume the current ratio is 3 to 1.Estimating the warranties expense on the period's sales would cause the current ratio to

• A)increase.
• B)decrease.
• C)be unchanged since the effects offset one another.
• D)be unchanged since it has no effect on any current accounts.

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Definitions:

Solution

A homogeneous mixture composed of two or more substances in which the solute is completely dissolved in the solvent.

Molality

A measure of the concentration of a solute in a solution in terms of amount of substance per mass of solvent, specifically moles of solute per kilogram of solvent.

Molarity

A measure of the concentration of a solute in a solution, expressed as the number of moles of solute per liter of solution.

Variable

An element, feature, or factor that is liable to vary or change.