Alpha Company Provided the Following Balance Sheet for Year 2

question 89

Multiple Choice

Alpha Company provided the following balance sheet for Year 2: $\begin{array}{|l|r|}\hline \text { Assets }\\\hline \text { Cash } & \$ \quad 5,400 \\\hline \text { Accounts receivable } & 15,500 \\\hline \text { Inventory } & 18,000 \\\hline \text { Prepaid expenses } & 1,600 \\\hline \text { Plant and equipment, net of depreciation } & 25,000 \\\hline \text { Land } & \underline { 19,950} \\\hline \text { Total assets } & \underline { \$ \quad 85,450} \\\hline\\\hline \text { Liabilities and Stockholders' Equity }\\\hline \text { Accounts payable } & \$ \quad4,500 \\\hline \text { Salaries payable } & 11,500 \\\hline \text { Bonds payable (Due in 2020) } & 10,000 \\\hline \text { Common stock, no par } & 30,000 \\\hline \text { Retained earnings } & \underline {29,450} \\\hline \text { Total liabilities and stockholder' equity } & \underline {\$ \quad 85,450} \\\hline\end{array}$ What is the company's plant assets to long-term liabilities ratio?

• A) 2.5
• B) 4.5
• Note that I changed correct answer
• C) 1.7
• D) None of these answers is correct.

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Definitions:

Energy Conversion

The process of transforming energy from one form to another, such as from chemical energy to mechanical energy.

Potential Energy

The energy stored in an object or system due to its position, condition, or composition.

Kinetic Energy

The energy that an object possesses due to its motion, dependent on mass and velocity.

Efficient

Performing or functioning in the best possible manner with the least waste of time and effort.