A company uses cash to pay off a short-ter

问题单项选择题

A company uses cash to pay off a short-term notes payable. If the company’s current ratio before the transaction is 2.0 times and the quick ratio was 1.0 times, how would this transaction affect the company’s current, quick and debt ratios Current ratioQuick ratioDebt-to-equity ratio()

A. Increase Increase Decrease

B. Decrease Decrease Increase

C. Increase Remain unchanged Decrease

答案

参考答案：C

解析：

A simple numerical example can help. Assume CA=2 and CL=1. Then note and Debt is decreased, but equity is unchanged, so D/E is decreased.