Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

One of the following cause increase in current ratio 1- increase fixed assets 2- decrease accrual expenses 3- decrease in cash 4- collect of A/R

user-image
Question added by Ahmed kandil , Cost Controller , Battour Holding Cpompany
Date Posted: 2015/03/09
Mahmoud Abbasi
by Mahmoud Abbasi , Chief Financial Officer , Conglomerate Trading & Contracting Co

2- Decrease Accrual Expenses

 

Muhammad Ramzan Tufail  ACCA
by Muhammad Ramzan Tufail ACCA , Assistant Finance Manager , Eltizam Asset Management Group

Option (2) is correct Ans.

 

This will reduce the current liabilities and so, increase the current ratio.

 

 

 

Habeeb Rahaman Punnakkal
by Habeeb Rahaman Punnakkal , Finance Manger , Telal Engineering & Contracting L L C

Answer  - No2 -Decrease in accrual Expense 

Muhammad Asif
by Muhammad Asif , Accountant , Prestige Plastics LLC

decrease in accrual expenses because it will reduce current liabilities 

Leonard Santiago
by Leonard Santiago , Analyst - Financial & Budget , Unified Real Estate Development Company

decrease accrual expenses will cause an increase in current ration.1 and4 doesn't affect the current ratio while3 will decrease current ratio

VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Answer option: >>>>>>>>>>>    Decrease accrual expenses

Samsheer ck samsheer
by Samsheer ck samsheer , Accounts Manager , Al madina group

Current ratio= Current asset/ current liabilities

Currect answer :

No2 -Decrease in accrual Expense

Anas  Dawah
by Anas Dawah , Senior Internal Auditor , Talal Abu-Ghazaleh Global (TAGI)

2-

Decrease in accrual Expenses decreases current Assets and when current Assets decrases the Current Ratio increases 

rohit mehra
by rohit mehra , Group GM - Finance and accounts , Sun and Sand Group

i guess none of them....all other options already explained....i wish to talk about decrease in accrual expenses....yes decrease in accrual expenses will effect in decreasing current liability but how does this decrease happen, you must have paid through cash / bank which already reduced your current assets....therefore no effect on current ratio

FITAH MOHAMED
by FITAH MOHAMED , Financial Manager , FUEL AND ENERGY CO for transportion petroleum materials

 

2- >>>>>>>>>>>>>decrease accrual expenses