I dont remember the question but its like this the current

I don\'t remember the question, but it\'s like this \" the current ratio is 0.9 The company borrow $10000 cash in the short term. how is the current ratio?

Solution

Current ratio = 0.9

Assume Current assets = 90,000 & Current liabilities = 100,000

After Borrowingg cash will be increased by 10,000 = 90,000+10,000 = 100,000

Current liabilities = 100,000+10,000 = 110,000

Current ratio = current assets/current liabilities = 100,000/110,000 =0.91

Current ratio increased from 0.90 to 0.91

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