The General Ledger of Covington Contains the Following Selected Account

question 37

Multiple Choice

The general ledger of Covington contains the following selected account balances:

Covington wants to order additional goods and services before the fiscal year end.What is the unencumbered balance of the budget that may be expended by Covington?

• A)$610,000
• B)$670,000
• C)$1,360,000
• D)$1,440,000

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Definitions:

Long-Term Debt

Borrowings that are due to be repaid more than one year from the date of the financial statement.

Dividend Payout

A portion of a company's earnings that is distributed to shareholders.

External Financing Needed

The additional funding a firm requires to finance its spending plans, such as investments in fixed assets or increases in working capital, beyond what can be funded by internal sources.

Dividend Payout Ratio

A metric indicating the proportion of a company's net profits paid out to its shareholders as dividends.