If you are a lender who is in the process of examining the debt to equity ratio of four different companies, which of the following ratios would, generally, be considered the most favourable to you?

Select one:

a. 0.8

b. 1.0

c. 0.5

d. 2.0

Inventory as shown on the financial statements of a business:

Select one:

a. is recorded as a current asset

b. is recorded as a long-term liability

c. is recorded as a short-term liability

d. is recorded as a long-term asset

The purpose of the statement of cash flow is:

Select one:

a. to identify the profits of the business generated from cash

b. to identify the sources and uses of cash

c. to identify the uses of cash

d. to identify the sources of cash

A company experiences inventory shrinkage and records the proper entry to account for it. As a result of this entry:

Select one:

a. gross profit will increase and net income will decrease

b. gross profit will increase and net income will increase

c. gross profit will decrease and net income will increase

d. gross profit will decrease and net income will decrease

The income statement is also called:

Select one:

a. statement of earnings

b. all of the choices

c. statement of comprehensive income

d. statement of income.