Compute the Current Liabilities for the Yi Yo Investment Center

question 88

Multiple Choice

Compute the current liabilities for the Yi Yo investment center as shown below. $\begin{array}{lr} & \text { Yi Yo Subsidiary } \\\text { Total sales } & \$ 18,000 \\\text { After-tax operating income } & \$ 1,000 \\\text { Total assets } & \$ 15,000 \\\text { Current liabilities } & \$ ? \\\text { Total assets - current liabilities } & \$ 3,500 \\\text { Cost of capital } & 15 \% \\\text { Ficnnnmic value ardlerl } &?\end{array}$

• A) $475
• B) $525
• C) $1,000
• D) $11,500

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Definitions:

Retained Earnings

The part of a company's earnings that is not distributed as dividends to its shareholders but instead is held back or saved.

Hiring

The process of finding, evaluating, and establishing a working relationship with new employees.

Investment

The act of allocating resources, usually money, with the expectation of generating an income or profit.

Accounts Payable

Money owed by a business to its suppliers shown as a liability on the company's balance sheet.