Explanation:
Virement is the process of transferring funds from one budget head to another to meet unforeseen expenses without increasing the total budget.
A firm's current ratio is 1.5:1. It wants to maintain a current ratio of 2:1 by paying off some current liabilities. Which of the following will happen?
Explanation:
Paying current liabilities reduces both current assets (cash) and current liabilities equally, leaving working capital (CA - CL) unchanged, though ratio improves.
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