Ernie's Mufflers Has Current Liabilities of $45 Million

question 31

Multiple Choice

Ernie's Mufflers has current liabilities of $45 million. Cash makes up 5 percent of the current assets and accounts receivable makes up another 50 percent of current assets. Ernie's current ratio = 1.5 times. What is the value of inventory listed on the firm's balance sheet?

• A) $13.75m.
• B) $20.25m.
• C) $30.375m.
• D) $33.75m.

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Definitions:

Unconditioned Stimulus

In classical conditioning, a stimulus that naturally and automatically triggers a reflexive response without any prior learning.

Conditioned Stimulus

An initially neutral signal that, once it's linked with an unconditioned stimulus, ultimately provokes a conditioned response.

Conditioned Response

A learned response to a previously neutral stimulus that has become associated with an unconditioned stimulus.

Ivan Pavlov

A Russian physiologist best known for his work in classical conditioning, demonstrating the learning process of associative reflexes.