The Price of a Bag of Corn Chips Is $3

question 50

Multiple Choice

The price of a bag of corn chips is $3, and the price of a bottle of soda is $1. What is the relative price of a bottle of soda?

• A) $3
• B) 33¢
• C) 1/3 bag of corn chips
• D) 3 bags of corn chips

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Definitions:

Interest Expense

The cost incurred by an entity for borrowed funds, reflected as a charge on the income statement.

Average Collection Period

The average number of days it takes for a company to receive payment from its customers for invoices issued.

Accounts Receivable Turnover

A financial ratio indicating how many times a company's receivables are converted into cash over a period, measuring the efficiency of a company in collecting its debts.

Current Ratio

A financial ratio indicating a firm's capacity to settle short-term debts using its current assets.