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QUESTION 9 Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will an increase in accounts receivable affect each ratio? No
QUESTION 9 Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will an increase in accounts receivable affect each ratio? No change to the current ratio and decrease the acid-test ratio. Increase the current ratio and increase the acid-test ratio. Decrease the current ratio and decrease the acid-test ratio. Decrease the current ratio and increase the acid-test ratio. QUESTION 10 Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will the purchase of inventory with cash affect each ratio? Increase the current ratio and increase the acid-test ratio. No change to the current ratio and decrease the acid-test ratio. Decrease the current ratio and decrease the acid-test ratio Decrease the current ratio and increase the acid-test ratio. QUESTION 11 At the beginning of 2018, Angel Corporation began offering a 1-year warranty on its products. The warranty program was expected to cost Angel 4% of net sales. Net sales made under warranty in 2018 were $180 million. Five percent of the units sold were returned in 2018 and repaired or replaced at a cost of $5.3 million. The amount of warranty expense on Angel's 2018 income statement is: $5.3 million $7.2 million $9.0 million. $27.0 million
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