How Would the Quick Ratio Be Affected by a Prepayment

question 9

Multiple Choice

How would the quick ratio be affected by a prepayment of $30,000 for fire and liability insurance?

• A) The quick ratio would decrease.
• B) The quick ratio would increase.
• C) The quick ratio would not change.
• D) The effect cannot be determined from the information given.

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Definitions:

Capital Offense

A crime that is punishable by the death penalty, typically including the most serious offenses such as murder or treason.

Third-degree Felony

A category of crime considered less serious than first or second-degree felonies, but still criminally significant, subject to legal penalties including imprisonment.

Model Penal Code

A standardized set of criminal laws developed as a guideline to shape and modernize the penal laws of the United States.

Capital Offense

An offense for which the legal system can impose the death penalty.