Mitchell Corporation has current assets of $1,600,000 and current liabilities of $750,000.If they issue $200,000 of new stock what will their new current ratio be? (rounded)
A)2.4:1
B)1.9:1
C)1.7:1
D)2.13:1

Question

Quizplus · Accepted Answer

Issuing $200,000 of new stock increases current assets to $1,800,000 while current liabilities remain $750,000. The new current ratio is $1,800,000 / $750,000 = 2.4:1.

Mitchell Corporation Has Current Assets of $1,600,000 and Current Liabilities