On the Balance Sheet of Last Year,a Company Reports Total

question 71

Multiple Choice

On the balance sheet of last year,a company reports total assets of $8 million,common shares (book value) of $4 million,and retained earnings of $2 million.At the end of the current year,the net income was $ 1 million,and the whole amount was retained by the firm.Everything else (each of the aforementioned amounts other than retained earnings) was held constant.The debt-to-equity ratio at the end of the current year is:

• A) 0.17
• B) 0.14
• C) 0.25
• D) 0.33

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Definitions:

Pyroclastic Eruption

A volcanic eruption involving the explosive ejection of hot ash, lava fragments, and gases.

Pegmatite

An igneous rock containing very large crystals, which may be centimeters to meters long.

Igneous Pegmatite

A coarse-grained igneous rock composed primarily of large crystals, often containing rare minerals.

Magma

The molten or semi-molten natural material from which all igneous rocks are derived, located beneath the Earth's surface.