Matie's Playground Equipment Has Current Assets of $128,400 and Current

question 67

Multiple Choice

Matie's Playground Equipment has current assets of $128,400 and current liabilities of $78,950. Find the current ratio. (Round to the nearest hundredth)

• A) .78:1
• B) 1.63:1
• C) .61:1
• D) .75:1

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Definitions:

Safety Margin

The difference between the actual level of sales or production and the break-even point, measuring the cushion a company has before it incurs losses.

Break Even Point

The financial analysis term where total revenues equal total expenses, and there is no profit or loss.

Budgeted Revenue

The amount of income that a company plans or expects to generate over a certain period, often used for planning and performance evaluation purposes.

After-Tax Profit

The net income a company generates after all taxes have been deducted from total revenues.