Viva Inc Produces and Sells Coffee Beans

question 37

Multiple Choice

Viva Inc. produces and sells coffee beans. This month it earned $500 by selling coffee beans to Jeffery Inc. The $500 received by Viva is its:

• A)revenue.
• B)equity.
• C)gain.
• D)debt.

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Definitions:

Debt/Equity Ratio

A calculation that shows how much a company relies on borrowed funds, found by dividing the sum of its liabilities by the equity owned by shareholders.

Long-term Debt Ratio

A financial ratio that shows the proportion of a company’s long-term debt compared to its total assets.

Total Debt

Refers to the sum of all financial obligations (short-term and long-term liabilities) owed by an individual or entity.

Net Cash

The amount of cash that is available after all debts, expenses, and operational costs have been deducted.