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Dungy Training Company has a current ratio of 0.70 to 1, based on current assets of $5.6 million and current liabilities of $8.00 million. 1.

Dungy Training Company has a current ratio of 0.70 to 1, based on current assets of $5.6 million and current liabilities of $8.00 million. 1. How, if at all, will a $850,000 cash purchase of inventory affect the current ratio?

2. How, if at all, will a $850,000 purchase of inventory on account affect the current ratio?

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