Current AssetsEquipmentLandTotal AssetsAccount TitleOn January 2, Year 1, the company recorded the following transaction:Accounts receivableService revenue$19,000 Current Liabilities39,000 Long-term Liabilities31,000$89,000Common StockTotal Liabilities & Stockholders' EquityMultiple ChoiceDebit20,100How will this transaction affect the current ratio?It will decrease the current ratio to 1:1.It will increase the current ratio to 2.2.1.Credit20,100$8,50029,00051,500$89,000

The ratio analysis helps to analyse the financial statements of the business on the basis of the…

Current Assets Equipment Land Total Assets On January 2, Year 1, the company recorded the following transaction: Account Title $19,000 Current Liabilities. 39,000 Long-term Liabilities. Common Stock 31,000 $89,000 Total Liabilities & Stockholders' Equity Accounts receivable Service revenue Debit 20,100 How will this transaction affect the current ratio? Credit 20,100 $8,500 29,000 51,500 $89,000

Current Assets Equipment Land Total Assets On January 2, Year 1, the company recorded the following transaction: Account Title $19,000 Current Liabilities. 39,000 Long-term Liabilities. Common Stock 31,000 $89,000 Total Liabilities & Stockholders' Equity Accounts receivable Service revenue Debit 20,100 How will this transaction affect the current ratio? Credit 20,100 $8,500 29,000 51,500 $89,000

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 6MCQ

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