Use the Following to Answer Questions

question 7

Multiple Choice

Use the following to answer questions :
Figure: Sugar and Freight Trains
-(Figure: Sugar and Freight Trains) Look at the figure Sugar and Freight Trains. Suppose the economy is operating at point C. The opportunity cost of producing the fourth freight train would be:

• A)19 tons of sugar.
• B)45 tons of sugar.
• C)80 tons of sugar.
• D)3 freight trains.

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Definitions:

Quick Assets

Those assets— mainly cash, accounts receivable, and notes receivable—that can be easily turned into cash.

Current Liabilities

Obligations that will come due within one year or within the operating cycle, whichever is longer.

Common-Size Income Statement

A common-size income statement presents all line items as a percentage of revenue, allowing for easier comparison across companies and time periods by standardizing financial statements.

Net Sales

The revenue from sales after deducting returns, allowances for damaged or missing goods, and discounts.