How Would the Collection of an Account Receivable Affect the Current

question 43

Multiple Choice

How would the collection of an account receivable affect the current ratio and the quick ratio,respectively?

• A)No effect on current ratio;increase in quick ratio
• B)Increase in current ratio;increase in quick ratio
• C)No effect on current ratio;no effect on quick ratio
• D)Decrease in current ratio;decrease in quick ratio

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Definitions:

Estimated

Calculated approximations or predicted values based on statistical models and available data.

Teenagers

Individuals who are in the age group of 13 to 19 years.

Labor-Force Participation

The proportion of individuals within the working-age range who are currently employed or are seeking employment actively.

Prime Working Age

The age range typically considered most productive for work, often defined as between 25 and 54 years old.