Turner Co Presently Has a Current Ratio of 0

question 177

Multiple Choice

Turner Co. presently has a current ratio of 0.8. The company has been informed by its bank that it must improve its current ratio to qualify for a line of credit. Which of the following actions would improve the current ratio?

• A)Use cash to pay off some current liabilities.
• B)Purchase additional marketable securities with cash.
• C)Acquire a parcel of land in exchange for common stock.
• D)Purchase additional inventory on credit.

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Definitions:

Applied Psychologist

A professional who uses psychological principles and research methods to solve practical problems in fields such as health, education, and business.

Cognitive Psychologist

A psychologist who studies mental processes such as memory, perception, thought, and problem-solving.

Problem Solving

The process of identifying a challenge or obstacle and finding a resolution or way to overcome it.

Unconscious Emotional Conflicts

Internal struggles often stemming from childhood that influence behavior and emotions without one's conscious awareness.