question 86
Multiple Choice
Comparative financial statements for Bent Stew Enterprises are shown below: Assets Current assets: Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment, net Intangible assets, net Total assets Liabilities and Stockholders’ Equity Current liabilities: Accounts payable Other current liabilities Total current liabilities Long-term debt Total liabilities Stockholders’ equity: Common stock Additional paid-in capital Retained earnings Total stockholders’ equity Total liabilities and stockholders’ equity Sales Cost of goods sold Gross margin Operating expenses Operating income Interest expense Earnings before income taxes Income taxes Net earnings December 312018$3,0008,50012,0001,40024,900103,60064,000$192,500$11,00011,80022,800120,000142,80015,00020,00014,70049,700$192,500 Year Ended December 312018$250,000164,00086,00064,00022,0007,50014,5007,800$6,7002017$8006,0008,20090015,900123,30047,000$186,200$12,0003,20015,200128,000143,20015,00020,0008,00043,000$186,2002017$230,000142,30087,70054,00033,7005,90027,8007,140$20,680 How much is Bent Stew's quick ratio at the end of 2018?
Definitions:
Variable Costs
Costs that vary depending on the level of production or sales.
Fixed Costs
Expenses that remain constant regardless of production or sales volume, including rent, salaries, and insurance costs.
Total Cost
The complete amount of money required to purchase, produce, execute, or maintain something, including all related expenses and charges.
Contribution Margin
The selling price per unit minus the variable cost per unit, reflecting the amount contributing to covering fixed costs.