SOLUTION IncreaseReason: Quick Assets (Cash) will increase whereas there will be no change in current liabilities.
SOLUTION Decrease.Reason: Current Liabilities (Creditors) will increase with no change in quick assets
SOLUTION No effect because neither the Current assets nor the Current liabilities are affected. Only one Current asset is converted into another Current asset.
SOLUTION Current ratio Will decrease because both Current assets and Current liabilities are decreased by the same amount.
SOLUTION Current ratio will not alter because both Current assets and Current liabilities are decreased by the same amount.
SOLUTION Current Ratio will improve because both Current assets and current liabilities are decreased by the same amount.
SOLUTION DecreaseReason: Both Current Assets and Current Liabilities will increase by the same amount.
SOLUTION Yes, it should be treated as a current liability because this facility is granted by bank for a period of one year or less and it has to be…
SOLUTION Prepaid expenses are not considered as liquid assets because they cannot be converted into cash.