A companys current ratio is 2.0. Suppose the company uses cash to retire notes payable due within

Question:

A company’s current ratio is 2.0. Suppose the company uses cash to retire notes payable due within 1 year. What would be the effect on the current ratio and ratio?

Asset Turnover
Asset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.