A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will a. increase and remain the same, respectively b. remain the same and decrease, respectively c. both decrease d. both increase

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
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Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 6CDQ: For Belzcr Corporation, the working capital at the end of the current year is $24,000 more than the...
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  1. A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability.  As a result of this transaction, the current ratio and working capital will
      a.
    increase and remain the same, respectively
      b.
    remain the same and decrease, respectively
      c.
    both decrease
      d.
    both increase
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