The Balance Sheet and Income Statement Shown Below Are for Pettijohn

question 63

Multiple Choice

The balance sheet and income statement shown below are for Pettijohn Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.

-What is the firm's market-to-book ratio?

• A) 0.56
• B) 0.66
• C) 0.78
• D) 0.92
• E) 1.08

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Definitions:

Data

Factual information used as a basis for reasoning, discussion, or calculation, often numerical.

Business Environment

The combination of internal and external factors that influence a company's operating situation, including economic, legal, political, and social conditions.

Information

Data that is processed, organized, structured, or presented in a given context to make it meaningful and useful.

Ratio Data

A type of quantitative data that not only measures the magnitude but also allows for the comparison of differences and the calculation of ratios, having an absolute zero point.