Question
When a company accrues federal income taxes at the end of the accounting period: A. Its acid - test ratio increases. B. Its current ratio
When a company accrues federal income taxes at the end of the accounting period:
A.
Its acid
-
test ratio increases.
B.
Its current ratio increases.
C.
Its debt to equity ratio decreases.
D.
Its debt to
equity ratio increases
Why would the debt to equity ratio increase? Wouldn't an accrued expense increase total liabilities and also increase stockholders equity?
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