Peak Performance Sporting Goods Company Has Just Applied for a Bank

question 22

Multiple Choice

Peak Performance Sporting Goods Company has just applied for a bank loan in order to expand the business. Using the most recent balance sheet data provided by the company owner, you calculate that the company's current ratio is 2.5. In your presentation to the company boss, you remark

• A) Peak Performance is currently having trouble meeting its short-term obligations.
• B) Peak Performance has $2.50 that it owes each month, for every $1.00 of cash that it is generating.
• C) Peak Performance has $2.50 of current assets for each $1.00 of current liabilities.
• D) Due to the fact that most of Peak Performance's current assets are tied up in inventory, there is no need to worry about whether Peak Performance will be able to make loan payments.

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Definitions:

Chemotherapy

A type of cancer treatment using one or more anti-cancer drugs as part of a standardized chemotherapy regimen to kill or stop the growth of cancer cells.

Radiation

The emission or transmission of energy in the form of waves or particles through space or a material medium.

Side Effects

Unintended and usually undesirable symptoms caused by a treatment or medication.

Psychological Interventions

Therapeutic methods aimed at alleviating psychological distress or disorders through various strategies, such as counseling or cognitive-behavioral therapy.