The acquisition of equipment in an exchange for a company's stock would increase the current ratio of the company.

Name: The acquisition of equipment in an exchange for a company's stock would increase the current ratio of the company.
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Question

Quizplus · Accepted Answer

The current ratio is calculated as current assets divided by current liabilities. Acquiring equipment in exchange for stock does not affect current assets or current liabilities, so it does not change the current ratio.

The Acquisition of Equipment in an Exchange for a Company's