The Balance Sheet for Jim's Hardware Has the Following Items

question 2

Multiple Choice

The balance sheet for Jim's Hardware has the following items listed. Current Liabilities, $25,345; Long -Term Debt, $100,000; Total Liabilities, $125,345; Total Assets, $325,490. What is the Debt to Equity Ratio for this company?

• A) 0.385
• B) 0.499
• C) 0.307
• D) 0.626
• E) 0.198

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Definitions:

Rights Offering

A financial opportunity allowing current shareholders to purchase additional shares directly from the company at a predetermined price, usually at a discount to the market price.

Subscription Price

The price at which existing shareholders are allowed to buy additional shares of a company's stock in a rights issue, usually at a discount to the current market price.

Market Price

The market rate at which a service or asset can currently be purchased or sold.

Underwriting Spread

The underwriting spread refers to the difference between the price an underwriter pays to the issuer of a security and the price at which it sells the security to investors.