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Practice question

MCQ

Question

The current ratio is 2 : 1. which of the following transactions would "not change" the current ratio: (a) Payment of current liability; (b) Purchased goods on credit; (c) Sale of a Computer (Book value: Rs. 4,000) for Rs. 3,000 only; (d) Sale of merchandise (goods) costing Rs. 10,000 for Rs. 11,000; (e) Payment of dividend.

Options

Choose one · Correct answer highlighted

Explanation

Current ratio unchanged by equal decrease current assets liabilities; transaction analysis shows.

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