The Financial Statements for Stephens' Electric Company Include the Following

question 7

Multiple Choice

The financial statements for Stephens' Electric Company include the following items: $$\begin{array} { l r r } & 2017 & 2016 \\\text { Cash } & \$ 55,000 & \$ 51,000 \\\text { Cash Equivalents } & 23,500 & 20,000 \\\text { Net Accounts Receivable } & 30,000 & 26,000 \\\text { Merchandise Inventory } & 81,000 & 65,000 \\\text { Total Assets } & 530,000 & 548,000 \\\text { Accounts Payable } & 44,500 & 35,000 \\\text { Salaries Payable } & 24,000 & 20,000 \\\text { Long-term Note Payable } & 61,000 & 57,000 \\\text { Income From Operations } & 124,500 & 115,000 \\\text { Interest Expense } & 28,000 & 33,000\end{array}$$ Compute the 2016 cash ratio.(Round your answer to two decimal places. )

• A)1.29
• B)1.15
• C)2.03
• D)0.63

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Definitions:

Skill-Based Pay

A compensation system where employees' wages are based on their skills, knowledge, and abilities rather than their job title or position.

Productivity

The measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs.

Forced Distribution

A performance evaluation method where employees' performances are ranked and distributed along a bell curve, forcing differentiations among workers.

Performance Appraisal

Performance appraisal is a systematic evaluation of an employee's job performance and productivity, typically conducted by managers or supervisors.