Please Refer to the Partial Balance Sheet Data Provided Below

question 100

Multiple Choice

Please refer to the partial balance sheet data provided below: $\begin{array}{|l|c|c|c|c|}\hline \text { (Dollar amounts in millions) } & 2017 & & 2016 & \\\hline & \text { Amount } & \% \text { of total } & \text { Amount } & \% \text { of total } \\\hline{\text { Liabilities }} & \\\hline \text { Current liabilities } & \\\hline \text { Accounts payable } & \$ 8500 & 3.1 \% & \$ 7300 & 2.9 \% \\\hline \text { Other current liabilities } & 1400 & 0.5 \% & 3900 & 1.6 \% \\\hline \text { Total current liabilities } & 9900 & 3.6 \% & 11200 & 4.5 \% \\\hline \text { Long-term loans payable } & 54000 & 19.7 \% & 30000 & 12.0 \% \\\hline \text { Total liabilities } & \$ 63900 & 23.4 \% & \$ 41200 & 16.5 \% \\\hline \text { Shareholders' equity } \\\hline \text { Share capital } & 161000 & 58.9 \% & 161000 & 64.4 \% \\\hline \text { Retained earnings } & 48700 & 17.8 \% & 47900 & 19.2 \% \\\hline \text { Total shareholders' equity } & \$ 209700 & 76.6 \% & \$ 208900 & 83.5 \% \\\hline \text { Total liabilities and shareholder's' equity } & \$ 273600 & 100.0 \% & \$ 250100 & 100.0 \% \\\hline\end{array}$ Which of the following would be a valid conclusion from the above data?

• A)Shareholders' equity,as a percentage of total liabilities and shareholders' equity,declined over a two year period.
• B)Shareholders' equity declined to 76.6% of net sales in 2017.
• C)Shareholders' equity was up 76.6% over a two year period.
• D)Shareholders' equity was equal to 76.6% of total liabilities in 2017.

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Definitions:

Wholesale Distributor

A business entity that purchases goods in large quantities from manufacturers and sells them in smaller quantities to retailers or other distributors.

Territorial Restriction

A limit imposed on the area or region where a product or service can be sold or provided.

Price-Cutting

The practice of reducing prices, often below the normal value, to attract customers or undermine competitors.

Direct Competition

The scenario where businesses offer the same or similar products or services to the same customer base, competing directly for market share.