At the End of the Current Year, Norman Company Reported

question 196

Multiple Choice

At the end of the current year, Norman Company reported total liabilities of $300,000 and total equity of $100,000. The company's debt ratio on the last year-end was:

• A) 300%.
• B) 33.3%
• C) 75.0%.
• D) $400,000.
• E) Cannot be determined from the information provided.

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Definitions:

IASB and FASB

International Accounting Standards Board and Financial Accounting Standards Board, respectively, setting and promoting accounting standards.

Financial Position

A snapshot of the assets, liabilities, and equity of a company at a particular point in time, reflecting its economic condition.

Adjusted Trial Balance

A financial report that lists all accounts and their balances after adjustments have been made, used to ensure the total debits equal the total credits before preparing financial statements.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of a business.