The correct answer is A. cash received from debtors.
The current ratio is a liquidity ratio that measures a company’s ability to pay its short-term obligations. It is calculated by dividing current assets by current liabilities.
Cash received from debtors increases current assets, which will increase the current ratio.
Selling the old machine for cash increases cash, which is a current asset. However, it also decreases fixed assets, which are not included in the current ratio. Therefore, selling the old machine for cash will not affect the current ratio.
Converting debentures into equity shares increases equity, which is not included in the current ratio. Therefore, converting debentures into equity shares will not affect the current ratio.
Cash purchases decrease cash, which is a current asset. However, they also decrease accounts payable, which is a current liability. Therefore, cash purchases will not affect the current ratio.
In conclusion, the only transaction that would affect the current ratio is A. cash received from debtors.