An Increase in Which One of the Following Accounts Increases

question 85

Multiple Choice

An increase in which one of the following accounts increases a firm's current ratio without affecting its quick ratio?

• A) accounts payable
• B) cash
• C) inventory
• D) accounts receivable
• E) fixed assets

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Definitions:

Predicting Profits

The process of estimating the future financial profits of a business based on current data, trends, and analysis.

Production Volumes

The quantity of goods a company produces within a given period, often used to measure operational efficiency.

High-low Method

An accounting technique used to estimate the variable and fixed components of a company's costs, based on the highest and lowest levels of activity.

Fixed Costs

Expenses that do not change in total regardless of the level of production or sales activity.