Easy Company Reported the Following Data at Year-End

question 36

Essay

Easy Company reported the following data at year-end: $$\begin{array}{l}\begin{array} { | l | r | } \hline \text { Total shareholders' equity } & \$ 200,000 \\\hline \text { Current liabilities } & 75,000 \\\hline \text { Total assets } & 350,000 \\\hline \text { Current assets } & 80,000 \\\hline \text { Common stock (par \$10) } & 125,000 \\\hline\end{array}\\\\\begin{array} { | l | l | } \hline \text { (a) } & \text { Compute the debt/equity ratio: } \\\hline \text { (b) } & \text { Compute shareholders' equity to total equities: } \\\hline \text { (c) } & \text { Compute creditors' equity to total equities: } \\\hline \text { (d) } & \text { Compute the current ratio: } \\\hline\end{array}\end{array}$$

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Definitions:

Market-Oriented Economy

A market-oriented economy is one where economic decisions and the pricing of goods and services are guided by the interactions of individuals and businesses in the marketplace.

Enforce Contracts

The legal process of ensuring that the terms of a contract are upheld by the parties involved.

Private Property

A legal designation for the ownership of property by non-governmental legal entities, giving the owner exclusive rights over the use, disposal, and benefits of the property.

Federal Government

The federal government is the national government of a federated state, which holds the authority to govern the entire country and is responsible for areas such as defense, foreign policy, and interstate commerce.