Determine the effect on the current ratio the quick ratio


Determine the effect on the current ratio, the quick ratio, net working capital (current assets less current liabilities), and the debt ratio (total liabilities to total assets) of each of the following transactions. Consider each transaction separately and assume that prior to each transaction the current ratio is 2X, the quick ratio is 1X, and the debt ratio is 50%. The company uses an allowance for doubtful accounts. Use I for increase, D for decrease, and N for no change.

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Finance Basics: Determine the effect on the current ratio the quick ratio
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