• The balance sheet of DEF Corp. as of December 31, 2023, presents the following account balances:
  • Assets:
    • Cash and Cash Equivalents: $700,000
    • Accounts Receivable: $400,000
    • Inventory: $550,000
    • Prepaid Expenses: $75,000
    • Property, Plant, and Equipment: $1,300,000
    • Accumulated Depreciation: ($250,000)
    • Goodwill: $350,000
  • Liabilities and Equity:
    • Accounts Payable: $250,000
    • Accrued Liabilities: $120,000
    • Short-term Borrowings: $200,000
    • Long-term Debt: $900,000
    • Common Stock: $600,000
    • Retained Earnings: $600,000
  • Total Liabilities and Equity: $2,670,000
  • Total Assets: $3,550,000
• a. Calculate the Total Current Assets and explain their importance in assessing liquidity.
• b. Determine the Total Equity and discuss its implications for shareholder value.
• c. Compute the Debt-to-Asset Ratio and analyze its significance in evaluating financial risk.