Scholtes Corp. has current assets of € 90,000 and current liabilities of € 180,000. Which of the following transactions would improve their current ratio?
A) Paying € 20,000 of accounts payable.
B) Purchasing € 50,000 of inventory in credit (account payable)
C) Collecting €10,000 of accounts receivable
D) Refinancing a € 30,000 long-term mortgage with a short-term (current) loan.

Question

Scholtes Corp. has current assets of € 90,000 and current liabilities of € 180,000. Which of the following transactions would improve their current ratio?
A) Paying  € 20,000 of accounts payable.
B) Purchasing € 50,000 of inventory in credit (account payable)
C) Collecting €10,000 of accounts receivable
D) Refinancing a € 30,000 long-term mortgage with a short-term (current) loan.

Quizplus · Accepted Answer

The Answer of Scholtes Corp. has current assets of € 90,000 and current liabilities of € 180,000. Which of the following transactions would improve their current ratio?
A) Paying  € 20,000 of accounts payable.
B) Purchasing € 50,000 of inventory in credit (account payable)
C) Collecting €10,000 of accounts receivable
D) Refinancing a € 30,000 long-term mortgage with a short-term (current) loan.