Ramos Company
Ramos Company Included the Following Information in Its

question 47

Multiple Choice

Ramos Company
Ramos Company included the following information in its annual report:
$\begin{array}{|l|r|r|r}\hline & \mathbf{2 0 1 1} & \mathbf{2 0 1 0} & {\mathbf{2 0 0 9}} \\\hline \text { Sales } & \$ 178,400 & \$ 162,500 & \$ 155,500 \\\hline \text { Cost of goods sold } & 115,000 & 102,500 & 100,000 \\\hline \text { Operating expenses } & 50,000 & 50,000 & 45,000 \\\hline \text { Net income } & 13,400 & 10,000 & 10,500 \\\hline\end{array}$
-Refer to the information for Ramos Company.In a common size income statement for 2009,the cost of goods sold are expressed as: 

• A) 64.3%
• B) 40.0%
• C) 87 %
• D) 103%

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Definitions:

Bankruptcy

A legal proceeding involving a person or business that is unable to repay their outstanding debts, leading to a reorganization or elimination of debt under the laws of bankruptcy.

Key Employees

Employees considered crucial to the operation and success of a business due to their skills, knowledge, or roles.

Optimal Capital Structure

The best mix of debt, equity, and other financing sources that minimizes the company's cost of capital while maximizing its value.

Debt-equity Ratio

Ratio that measures a company's financial leverage by dividing its total liabilities by its shareholder's equity, indicating the balance between debt financing and equity financing.