Which of the Following Transactions Would Result in a Decrease

question 96

Multiple Choice

Which of the following transactions would result in a decrease in the current ratio?

• A)Collection of cash from an account receivable.
• B)Selling shares of stock to stockholders in exchange for cash.
• C)Purchasing a delivery vehicle by signing a long-term note payable.
• D)Purchasing land by paying cash.

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Definitions:

Chili Peppers

Fruit of plants from the genus Capsicum, used worldwide as a spice or vegetable, known for their hot and spicy flavor.

Daily Aspirin

A regimen of taking aspirin every day, often recommended to reduce the risk of heart attack or stroke.

Heart Attack

A medical emergency that occurs when the flow of blood to the heart is blocked, causing heart muscle damage or death.

Normal Good

A type of good for which demand increases when consumer income rises, and decreases when consumer income decreases.