A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will

The question is missing the options and is incomplete. The q=complete question is,

A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will:

a. both decrease

b. both increase

c. remain the same and decrease, respectively

d. increase and remain the same, respectively

The correct answer is option D as the current ratio has increased while the working capital has remained the same.

Explanation:

The current ratio is calculated by dividing the current assets by the current liabilities. The formula for current ratio is,

Current ratio = Current assets / current liabilities

The old current ratio was,

Current ratio = 70000 / 50000 = 1.4

After the transaction, the new current ratio is,

Current ratio = (70000 - 1000) / (50000 - 1000)  =  1.408

Thus, as a result of the transaction, the current ratio has increased.

The working capital is the difference between the value of current assets and the value of current liabilities.

The formula to calculate the working capital is,

Working capital = Current assets - Current liabilities

Old working capital = 70000 - 50000 = $20000

The new working capital = 69000 - 49000 = $20000

Thus, the working capital remain unchanged after the transaction.

hello the answer is d

this conflict is person vs. society

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