Aleve Company Purchased Inventory on Credit

question 129

Multiple Choice

Aleve Company purchased inventory on credit.The effect of this transaction is that the

• A)earnings per share decreased.
• B)working capital increased.
• C)debt-to-equity ratio increased.
• D)earnings per share increased.

---

Definitions:

Price Rises

An increase in the cost of goods or services, often due to factors such as inflation, increased production costs, or higher demand.

Existing Producers

Companies or individuals that are currently producing and selling goods or services within a market.

Consumer Surplus

The discrepancy between what consumers are prepared and able to spend on a good or service and the actual amount they end up paying.

Price Falls

Situations where the market prices of goods or services decrease over time.