When a Company Pays a Bill from a Plumber for Previous

question 115

Multiple Choice

When a company pays a bill from a plumber for previous services on account:

• A)Its debt to equity ratio decreases.
• B)Its acid-test ratio always remains unchanged.
• C)Its current ratio always remains unchanged.
• D)All of the other options are correct.

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Definitions:

Raw Materials Production Needs

The quantity and type of raw materials required to meet production targets and schedules.

Budgeted Unit Sales

The number of units that a company plans or expects to sell over a specific period according to its budget.

Raw Material Needs

The quantity and type of raw materials required for a company to manufacture its products.

Beginning Inventory

The value of goods available for sale or use at the start of an accounting period.