BSO, Inc., has a current ratio of 2.0 and working capital in the amount of $1,240,000. For

Question:

BSO, Inc., has a current ratio of 2.0 and working capital in the amount of $1,240,000. For each of the following transactions, determine whether the current ratio and working capital will increase, decrease, or remain the same.
a. Paid in the amount of $50,000.
b. Recorded accrued salaries in the amount of $100,000.
c. Borrowed $250,000 from a local bank, to be repaid in 90 days.
d. Purchased $20,000 of new inventory on credit.

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...