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Interpretation of financial statment

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Interpretation of financial statment

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by P2-D2.
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  • May 6, 2021 at 12:24 pm #619864
    ethan12
    Member
    • Topics: 1
    • Replies: 2
    • ☆

    Why does purchase of inventory in credit affect current liability more than it affect current asset?

    May 8, 2021 at 9:03 am #620022
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7177
    • ☆☆☆☆☆

    Hi,

    It doesn’t change the value of the current liability more than it does the current asset, but it can have more of an impact on the current ratio.

    Thanks

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