11 The chief financial officer (CFO) of DeWanna Company is preparing a presentation to give to the company's major banks and investors. These groups are concerned about DeWanna's liquidity. The CFO knows that a common measure of liquidity is the CURRENT RATIO. Consider the items below. Which items are used in computing CURRENT RATIO? Current Liabilities Capital Stock Current Assets Net Income Long-term Debt Retained Earnings Current Assets and Retained Earnings Current Assets and Current Liabilities Capital Stock and Current Liabilities Net Income and Current Liabilities Net Income and Long-term Debt 12 Lauren Company is currently under scrutiny by government regulators. Lauren hasn't been charged with any crimes, but government investigators are suspicious about Lauren's entire industry. The suspicion is that Lauren Company, and its industry competitors, have taken advantage of current market conditions to substantially increase their level of borrowing-putting the banking system at risk. Government regulators want to see what Lauren Company's DEBT RATIO is this year in order to assess whether Lauren has indeed increased borrowing to a dangerous level. Consider the items below. Which items are used in computing DEBT RATIO? Capital Stock Cost of Goods Sold Total Assets Total Liabilities Net Income Retained Earnings Sales Sales and Total Liabilities Retained Earnings and Total Assets Total Liabilities and Net Income Total Assets and Capital Stock Total Assets and Total Liabilities not 52 PM hot 00 PM