Pioneer Brewing Company is investing $1,000,000 in cash into a project to build a bottling facility. The $1,000,000 of cash will come from existing cash on hand, and will be paid up front to the contractor. The project will not generate significant return on investment for at least two years, but after that is expected to increase profits significantly. What affect will this $1,000,000 investment have in the short term, on the following ratios?

multiple choice

Current Ratio

[ Choose ] In the short-term, this ratio will likely decrease In the short-term, this ratio will not be affected by this project

ROE

[ Choose ] In the short-term, this ratio will likely decrease In the short-term, this ratio will not be affected by this project