Question : The current Ratio of X Ltd. is 2.5: 1. The Company purchased furniture of Rs. 45,000. The Vendor was paid by issue of equity shares of Rs. 10 each at par would
Option 1: Increase current Ratio
Option 2: Decrease Current ratio
Option 3: Have no effect on current ratio
Option 4: Decrease gross profit ratio
Answer (1)
24th Jan, 2024
Correct Answer: Have no effect on current ratio
Solution : Answer = Have no effect on the current ratio
Purchased furniture by issuing Eq. Share would neither increase nor decrease the current assets and current liabilities. So, no change in the Current ratio.
Hence, the correct option is 3.
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