S 10 Liabilities 8) BALANCE SHEET BIG VALLEY ENTERPRISES Income Statement Assets Liabilities and Equity Current Cash S 160 $ 275 Cash Sales Accounts 500 80 Long-Term Debt 230 receivable Credit sales Operating 115 Common Stock 75 Expenses Fixed Assets Retained 140 Depreciation Earnings Total $ 605 Total $ 605 Interest Taxes Net Income Inventory 400 Interest is Big Valley's only fixed cash charge. Big Valley's market value of equity to book value of debt ratio = 1.5. Peer Average Ratios Return on equity 15% Big Valley's return on equity indicates that the firm generates a return to their shareholders than their peers. A) 2.04 percent higher B) 3.02 percent higher C) 15.25 percent higher D) 5.75 percent lower E) 1.05 percent lower Answer Here