Which of the following would increase a companys current ratio (note: assume that the companys...
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Finance
Which of the following would increase a companys current ratio (note: assume that the companys current ratio is presently equal to 2.0)? Choose ALL that apply (this is an all or nothing question you must correctly choose all correct answers to receive any credit for this question).
a. Increase notes payable (i.e., borrow short term) to finance additional fixed assets.
b. Issue long-term debt to buy inventory.
c. Sell common stock to pay off the companys notes payable balance.
d. Sell fixed assets to reduce accounts payable.
e. Implement a just-in-time inventory policy that reduces the companys average inventory balance by 50 percent. The reduction in inventory will be matched with an equal decrease in accounts payable.
f. An increase in annual sales that increases the companys accounts receivable balance. This increase in accounts receivable will be matched by an equal increase in notes payable.
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