Listed in the right-hand column below are certain financial ratios. To the left of each ratio is a business transaction or event relating to the operating activities of Candice, Inc., an exporter of ceramic tile?
Business Transaction or Event Ratio_________________
1. The company declared a cash dividend.Current ratio
2. The company sold inventory on account.Acid-test ratio (quick ratio)
3. The company's net income decreased by Times interest earned5 percent between last year and this year.Long-term debt remained unchanged.
4. A previously declared cash dividend was paid.Current ratio
5. Obsolete inventory totaling $60,000 was Inventory turnover ratiowritten off at a loss.
6. The company sold inventory for cash at a profit.Debt-to-equity ratio
7. The company issued common stock for cash.Earnings per share
8. The company paid $7,000 on accounts payable.Current ratio
9. The company purchased inventory on credit terms.Acid test (quick ratio)
10. The market price of the company's common Price earnings ratiostock increased from $24.50 to $37.20.Earnings per share remained unchanged.
Required:
Indicate the impact of the transaction on the corresponding ratio (increase, decrease, or no effect).