A Firm Has Total Assets of $2,000,000

question 36

Multiple Choice

A firm has total assets of $2,000,000. It has $900,000 in long-term debt. The shareholders' equity is $900,000. What is the total debt to asset ratio?

• A) 45%
• B) 40%
• C) 55%
• D) None of the other answers are correct

Understand the definition and components of quick assets.

Identify the role of merchandise inventory in financial statements and its impact on operating cycles.

Recognize the categorization of expenses within the income statement.

Calculate and interpret the significance of the acid-test ratio for assessing liquidity.

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Definitions:

Climacteric Phase

A transitional stage in life, typically occurring in middle age, marked by a decline in reproductive hormones and associated with menopause in women.

Middle Adulthood

A stage of life, usually between the ages of 40 and 65, characterized by personal, professional, and family achievements and adjustments.

Anxiety

An emotion of anxiety or apprehension concerning an unpredictable result.

Hot Flashes

Sudden feelings of warmth, which are often accompanied by sweating and sometimes flushing, typically associated with menopause.