Karma Corporation Has Total Assets of $190,000 and Total Liabilities

question 172

Multiple Choice

Karma Corporation has total assets of $190,000 and total liabilities of $90,000. The corporation's debt-to-equity ratio is closest to:

• A) 0.47
• B) 0.90
• C) 0.53
• D) 0.32

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Definitions:

Cost of Goods Sold

Direct costs attributable to the production of the goods sold by a company, including materials and labor costs.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Financial Information

Data that pertains to the financial status, performance, and changes in the economic resources of an entity.

Debt to Equity

A financial metric that shows the comparative amount of debt and shareholders' equity utilized to fund a company's assets.