Which of the Following Transactions Would Increase the Current Ratio

question 55

Multiple Choice

Which of the following transactions would increase the current ratio of a company if the ratio is currently greater than 1?

• A)Paid the principal on a long-term note payable.
• B)Borrowed cash on a short-term note.
• C)Sold inventory for more than cost.
• D)Purchased supplies with cash.

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Definitions:

Sand-sized Grains

Particles of rock or mineral which fall within a specific size range, typically between 0.0625 and 2 millimeters, characteristic of sandstones.

Quartzite

A hard, non-foliated metamorphic rock which was originally pure quartz sandstone and transformed through heat and pressure.

Fractures

Breaks in rock or mineral formations where there has been no significant movement on either side.

Unmetamorphosed Sedimentary

Refers to sedimentary rocks that have not undergone metamorphism and retain their original sedimentary characteristics.