Use the Following Data to Calculate the Current Ratio A)207 : 1
B)1

question 10

Multiple Choice

Use the following data to calculate the current ratio. Carne Auto Supplies
Balance Sheet
December 31, 2017
$\begin{array}{lrlr}\text { Cash } & \$ 70,000 & \text { Accounts payable } & \$ 130,000 \\\text { Accounts receivable } & 100,000 & \text { Salaries and wages payable } & 20,000 \\\text { Inventory } & 140,000 & \text { Mortgage payable } & 180,000 \\\text { Prepaid insurance } & 80,000 & \text { Total liabilities } & \$ 330,000 \\\text { Stock investments } & 180,000 & &\\\text { Land } & 190,000 \\\text { Buildings } \quad \$ 230,000 &&\text { Common stock }&\$240,000\\\text { Less: Accumulated }&&\text { Retained earnings }&500,000\\\text { depreciation }\quad(60,000) &170,000&\text { Total stockholders' equity }&\$740,000\\\text { Trademarks } & 140,000&\text { Total liabilities and }\\\text { Total assets }&\$1,070,000&\text { stockholders' equity }&\$1,070,000\end{array}$

• A)2.07 : 1
• B)1.67 : 1
• C)3.00 : 1
• D)2.60 : 1

Determine marginal costs from given production data.

Calculate and understand the significance of average fixed costs.

Distinguish between different cost concepts: total cost, average variable cost, and marginal cost.

Understand the concept of average total cost.

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Definitions:

FOB Shipping Point

A term used in shipping agreements indicating that the buyer assumes responsibility for the goods and their transportation costs from the point of departure.

Insurance in Transit

Insurance in transit covers risk to goods and materials while they are being transported from one location to another.

Inventory Costs

Expenses associated with storing and managing goods that a company holds for sale.

Service Charge

A fee collected by a financial institution, or any other service provider, for the services they provide.