Refer to the Following Selected Financial Information from Shakley's Incorporated

question 9

Multiple Choice

Refer to the following selected financial information from Shakley's Incorporated. Compute the company's debt-to-equity ratio for Year 2. $$\begin{array} { | l | r | r | } \hline & { \text { Year 2 } } & { \text { Year 1 } } \\\hline \text { Net sales } & \$ 478,500 & \$ 426,250 \\\hline \text { Cost of goods sold } & 276,300 & 250,120 \\\hline \text { Interest expense } & 9,700 & 10,700 \\\hline \text { Net income before tax } & 67,250 & 52,680 \\\hline \text { Net income after tax } & 46,050 & 39,900 \\\hline \text { Total assets } & 317,100 & 288,000 \\\hline \text { Total liabilities } & 181,400 & 167,300 \\\hline \text { Total equity } & 135,700 & 120,700 \\\hline\end{array}$$

• A) 1.75.
• B) 2.34.
• C) 0.75.
• D) 1.34.
• E) 2.63.

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Definitions:

Mesosystems

In ecological systems theory, the interaction between two or more settings that the developing person actively participates in, such as the connection between family experiences and school life.

Exosystems

A layer in Bronfenbrenner's ecological systems theory referring to settings that indirectly influence an individual, such as parents' workplaces.

Macrosystems

The broadest context in ecological systems theory, encompassing societal norms, values, and laws that influence an individual's development.

Nuclear Families

Families consisting of parents (including single parents) and their children.