Yesterday, Bicksler Corporation purchased (and received) raw materials on credit from its supplier.All else equal, if Bicksler's current ratio was 2.0 before the purchase, what effect did this transaction have on Bicksler's current ratio?
A)increased
B)decreased
C)stayed the same
D)There is not enough information to answer this question.
E)None of the above is a correct answer.

Question

Quizplus · Accepted Answer

The purchase of raw materials on credit will increase Bicksler's current liabilities, which will decrease the current ratio.

Yesterday, Bicksler Corporation Purchased (And Received) Raw Materials on Credit