Asset Management and Debt Management Ratios Use the Following Information

question 39

Multiple Choice

Asset Management and Debt Management Ratios Use the following information to calculate current assets: Sales = $12 million, capital intensity ratio = 4 times, debt ratio = 45%, and fixed asset turnover ratio = 2.5 times.

• A) $4.8 m
• B) $21.6 m
• C) $43.2 m
• D) $48 m

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Definitions:

Textile Manufacturing

The process of converting raw fibers into finished fabrics or products through various methods of production.

Service Firm

A business that provides intangible products or services to customers, as opposed to tangible goods.

Labor Costs

The total expenses related to employing personnel, including wages, benefits, taxes, and any other costs associated with workforce management.

Worker Productivity

A measure of labor efficiency, indicating the output volume produced per unit of labor input.