Question : Assuming that the Current Ratio is 2: 1, the Sale of a fixed asset on a credit of 2 months would _____.
Option 1: Increase current ratio
Option 2: Decrease current ratio
Option 3: Neither increase nor decrease
Option 4: Increase debt equity ratio
Answer (1)
11th Jan, 2024
Correct Answer: Increase current ratio
Solution : Answer = Increase the current ratio
Assuming C. Ratio = 2 :1
Sale of fixed Assets on Credit
$=\frac{20,000}{10,000}$
Would increase the Current Ratio
Hence, the correct option is 1.
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