Alpha Enterprise has total current assets of $2,000,000 and total current liabilities of $800,000.If the company collects $100,000 of its accounts receivable,while none of its other assets and liabilities change,its current ratio will ________.
A)increase
B)decrease
C)stay the same
D)The answer cannot be determined from the information given.

Question

Quizplus · Accepted Answer

The current ratio is calculated as current assets divided by current liabilities. Collecting accounts receivable increases cash but does not change the total current assets or current liabilities, so the current ratio remains the same.

Alpha Enterprise Has Total Current Assets of $2,000,000 and Total