Mosaic Music has a current ratio of 2.0 ($240,000 current assets $120,000 current liabilities). For each

Question:

Mosaic Music has a current ratio of 2.0 ($240,000 current assets ÷ $120,000 current liabilities). For each of the following transactions, determine whether the current ratio will increase, decrease, or remain the same:
a. Borrowed $20,000 from a local bank to be paid in 60 days.
b. Accrued wages in the amount of $50,000.
c. Paid in the amount of $10,000.
d. Bought inventory on credit for $15,000.
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...