Ajax Company's current ratio would increase if the company
A) collects an outstanding account receivable for a major customer.
B) uses $1,000 of office supplies in the ordinary course of business.
C) receives a cash payment from a customer before Ajax renders services to that customer.
D) sells $100,000 of 20-year, 8% bonds at 103.
E) reclassifies a long-term liability as a current liability on its balance sheet.Use the following information to answer questions 57 - 59:Bracewell Corporation's current ratio is 2.5:1. The company's current liabilities total $200,000.

Question

Quizplus · Accepted Answer

Selling bonds increases cash (a current asset) without affecting current liabilities, thus increasing the current ratio.

Ajax Company's Current Ratio Would Increase If the Company