Assume the current ratio is 2 to 1.Payment on accrued salaries payable would cause the current ratio to
A)increase.
B)decrease.
C)be unchanged since the effects offset one another.
D)be unchanged since it has no impact on any current accounts.

Question

Quizplus · Accepted Answer

Paying accrued salaries decreases current liabilities, which increases the current ratio if current assets remain unchanged.

Assume the Current Ratio Is 2 to 1