How would the collection of an account receivable affect the current ratio and the quick ratio,respectively?
A) Increase in current ratio; increase in quick ratio
B) No effect on current ratio; no effect on quick ratio
C) No effect on current ratio; increase in quick ratio
D) Decrease in current ratio; decrease in quick ratio

Question

Quizplus · Accepted Answer

Collecting an account receivable converts one current asset (accounts receivable) into another (cash), so there is no change in the total current assets or quick assets, leaving both ratios unaffected.

How Would the Collection of an Account Receivable Affect the Current