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April 18, 2014

Homework Help: finance

Posted by jason on Monday, March 2, 2009 at 9:35pm.

A firm has $600,000 in current assets and $150,000 in current liabilities. Which of the following is correct if they use cash to pay off $50,000 in accounts payable?
1)Current ratio will increase to 5.0.
2)Net working capital will increase to $500,000.
3)Current ratio will decrease.
4) Net working capital will not change.

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