The current ratio measures the degree to which current assets cover current liabilities

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The current ratio measures the degree to which current assets cover current liabilities. A high ratio indicates a good probability that the company can retire current debt. When long term debt exceeds stockholder’s equity, the current ratio will fall.  What effect will reclassifying a long term investment into cash within one year have on the current ratio? Is a firm’s true financial position stronger as a result of reclassifying investments? What are the ethical ramifications of re-classifying investments? Give an example of when reclassifying a long term investment as a short term investment makes financial sense for the company.

PART #2

In this assignment, you will use the Internet and other sources to gather and interpret information related to service and manufacturing organizations.

Select either a service or a manufacturing organization of interest to you. Research the organization using the Argosy University online library and the Internet. Based on your research, do the following:

• Identify and classify the types of expenses associated with the operation of the selected organization.
• Review the income statement and balance sheet of the selected organization. What is your overall initial impression of the company based on the financial data you reviewed?

Write a 2 page report detailing your findings in MS Word format. Apply current APA standards for writing style to your work.