Jordan Artificial Foods has total assets of $789,400, long-term debt of $198,375, total equity of $364,182, net fixed assets of $512,100, and costs of goods sold of $121,500. The profit margin is 2.7 percent. What is the current ratio?

a.

0.95

b.

1.22

c.

1.40

Your grandparents would like to establish a trust fund that would pay annual payments to you and your heirs of $100,000 a year forever. How much do your parents need to deposit into this trust fund today to achieve their goal if the fund can earn 6 percent interest?

a.

$678,342.13

b.

$1,666,666.67

c.

$1,620,975.32

Which one of the following situations is most likely to create an agency conflict?

a.

Compensating a manager based on his or her division's net income

b.

Hiring an independent consultant to study the operating efficiency of the firm

c.

Rejecting a profitable project to protect employee jobs