The conversion of the company’s short-term debt into a long-term note payable would decrease both working capital and the current ratio.
The conversion of the company’s short-term debt into a long-term note payable would decrease both working capital and the current ratio.
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter6: Accounting Quality
Section: Chapter Questions
Problem 4QE
Related questions
Question
State whether the following statements are true of false.
Statement 1: The conversion of the company’s short-term
debt into a long-term note payable would decrease both
capital
Statement 2:A user of financial statements who is a short-term
creditor is interested in the borrower’s ability to pay interest
regularly.
STATEMENT 1 STATEMENT 2
a. True True
b. True False
c. False True
d. False False
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