The ratio of liabilities to stockholders' equity is 0.083.
<h3>What is the ratio of liabilities to stockholders' equity?</h3>
Liabilities are future benefits that would have to be sacrificed in the future by an entity to other entities as a result of past transactions. An example of liability is account payable.
Stockholder's equity is the difference between assets and liabilities. Assets are resources that can be used to increase the value of the firm. An example of an asset is account receivable.
The ratio of liabilities to stockholders' equity can be determined by dividing liabilities by stockholders equity.
The ratio of liabilities to stockholders' equity = liabilities / stockholders' equity
1000 / 12,000 = 0.083
To learn more about liabilities, please check: brainly.com/question/26513242
#SPJ1
Answer:
Investment revenue = $52,000
Explanation:
Since Puff uses the equity method, the original journal entry to record the purchase of 40% of the shares should have been:
Dr Investment in Straw 400,000
Cr Cash 400,000
After one year, Straw earned $150,000 in net income, but it also had equipment with a fair market value higher than carrying value also depreciable by $100,000. So the net income must be adjusted = $150,000 - ($100,000 x 20%) = $130,000. The journal entry to record the adjusted income should be ($130,000 x 40%):
Dr Investment in Straw 52,000
Cr Investment revenue 52,000
Answer:
- 10 percent interest due in one year
Explanation:
Simple interest calculates interests using the formula below.
I= p x r x t
Where P = principal amount
r = interest rate
t= time in years
<u>A). p= $5000, r= 7% or 0.07, t= 2 years</u>
I = $5000 x 0.07 x 2
I = $5000 x 0.14
I= $700
<u>B). p= $5000, r= 10% or 0.10 , t= 1</u>
I = $5000 x 0.10 x 1
I= $500
c). P= $5000, r= 8% or 0.08, t= 18months or 1.5years
I= $5000 x 0.08 x 1.5
I=$400x 1.5
I=$600
Option B is the better deal. The interest amount is $500, which is the lowest amongst all the options.
Answer:
A. True
Explanation:
The equity multiplier shows the amount of assets that are financed or owed by the shareholders. By increasing the equity multiplier a company can increase its return on equity.
