Question
33. A company purchases a building for $300,000 by making a $50,000 cash down payment and signing a long-term note payable for the balance.How will
33. A company purchases a building for $300,000 by making a $50,000 cash down payment and signing a long-term note payable for the balance.How will this transaction affect both working capital and the current ratio?
A.WorkingCapital: Decrease;CurrentRatio: No Effect
B.WorkingCapital: Increase;CurrentRatio: No Effect
C.WorkingCapital: Decrease;CurrentRatio: Decrease
D.WorkingCapital: Increase;CurrentRatio: Increase
E.WorkingCapital: No Effect;CurrentRatio: No Effect
Please help asap. Thank you.
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Accounting
Authors: Carl S Warren, James M Reeve, Jonathan Duchac
24th Edition
0538475005, 9780538475006
