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.

---

Definitions:

Discharge

The termination of an employee's job position by the employer, often for cause such as misconduct or poor performance.

Aggregate Welfare

The total level of well-being or economic prosperity of a community, region, or country, considering all individuals and factors collectively.

Top-Down Organizations

Organizations structured so that decision-making and directives flow from the upper levels of management down to the lower levels.

Shareholders

Individuals or entities that own shares in a corporation, giving them partial ownership and a right to part of the profits.