A Company with $75,000 in Current Assets,$37,500 in Quick Assets,and

question 159

Multiple Choice

A company with $75,000 in current assets,$37,500 in quick assets,and $45,000 in current liabilities makes a payment of a $3,000 oncurrent debt.As a result of this transaction,the current ratio and quick ratio will

• A)both decrease.
• B)increase and decrease,respectively.
• C)both increase.
• D)remain the same and decrease,respectively.

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Definitions:

Fixed Costs

Costs that do not vary with the level of output or production, such as rent, salaries, and insurance premiums.

Marginal Revenue

The additional income from selling one more unit of a good or service.

Demand Function

A mathematical expression that describes the relationship between the price of a good or service and the quantity demanded by consumers.

Typeset

The process of arranging and setting text material for printing, historically done using physical types but now primarily done using computer software.