Christy would like to improve the current ratio of her firm, which is now 0.5, so that she will have a better chance of obtaining a working capital loan. Which of the following options would improve her current ratio? a.purchase additional inventory on credit b.use cash to pay off notes payable c.collect some of her accounts receivables d.borrow short-term funds to pay off some payables

The current ratio is defined as ration of current assets and current liabilities.

Answered: Christy would like to improve the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Christy would like to improve the current ratio of her firm, which is now 0.5, so that she will have a better chance of obtaining a working capital loan. Which of the following options would improve her current ratio?

	a.	purchase additional inventory on credit
	b.	use cash to pay off notes payable
	c.	collect some of her accounts receivables
	d.	borrow short-term funds to pay off some payables

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