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Mark all statements that are correct. An identical decrease in accounts receivables and an increase in cash leaves the current ratio unchanged. If inventory is
Mark all statements that are correct.
An identical decrease in accounts receivables and an increase in cash leaves the current ratio unchanged.
If inventory is purchased with cash, there is no change in the current ratio.
Inventory sold for a profit raises cash in excess of the inventory recorded at cost, so the current ratio decreases.
Inventory sold at cost reduces inventory and raises cash, so the current ratio increases.
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