A Corporation Reports the Following Year-End Balance Sheet Data A) 058
B) 1

question 81

Multiple Choice

A corporation reports the following year-end balance sheet data. The company's current ratio equals: $$\begin{array} { l r l r } \text { Cash } & \$ 40,000 & \text { Current liabilities } & \$ 75,000 \\\text { Accounts receivable } & 55,000 & \text { Lore-tern liabilities } & 35,000 \\\text { Irventory } & 60,000 & \text { Corrnon stock } & 100,000 \\ \text { Equiprnent} &\underline{ 145,000 }& \text { Retained earnings } &\underline{ 90,000} \\ \text { Total assets } &\underline{ \$ 300,000} & \text { Total liabilities ard equity } & \underline{\$ 300,000}\end{array}$$

• A) 0.58
• B) 1.27
• C) 2.07
• D) 0.37
• E) 0.63

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Definitions:

Economic Activity

Actions that involve the production, distribution, and consumption of goods and services within an economy.

Progressive Tax

A tax system in which the tax rate increases as the taxable amount increases, often targeting higher incomes with higher tax rates.

Monetary Policy

The process by which a central bank or monetary authority manages the supply of money and interest rates to achieve macroeconomic objectives like controlling inflation, consumption, growth, and liquidity.

Federal Reserve Board

The governing body of the Federal Reserve System, the central bank of the United States, responsible for overseeing the country's monetary policy.