In Its Closing Financial Statements for Its First Year in Business

question 39

Multiple Choice

In its closing financial statements for its first year in business, the Runs and Goses Company, had cash of $242, accounts receivable of $850, inventory of $820, net fixed assets of$3,408, accounts payable of $700, short-term notes payable of $740, long-term liabilities of $1,100, common stock of $1,160, retained earnings of$1,620, net sales of $2,768, cost of goods sold of $1,210, depreciation of $360, interest expense of $160, taxes of $312, addition to retained earnings of $508, and dividends paid of $218.
-What is Runs and Goses' debt-to-equity ratio?

• A)0.91
• B)2.15
• C)0.48
• D)1.12
• E)2.32

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Definitions:

Ethanol Breakdown

The metabolic process by which ethanol is converted into acetaldehyde and then acetic acid, primarily in the liver.

Aldehyde Dehydrogenase

An enzyme that plays a crucial role in alcohol metabolism by oxidizing aldehydes into acids, reducing the toxic effects of alcohol consumption.

Acetaldehyde

A volatile, flammable, and colorless liquid compound that is an intermediate in the production of acid and alcohol metabolism.

Endergonic

Describes a reaction that requires a net input of free energy.