The formula to compute the debt ratio is A. total liabilities/total assets. B. income from operations/interest expense. C. total assets/total liabilities. D. interest expense/income from operations. A company reported the following amounts of net income: Which of the following is the percentage change from Year 1 to Year 2? A. 28.66% B. 19.15% C. 20.15% D. 53.29% The managerial accountant at the Holiday Musical Academy is required to complete the statement of cash flows. The managerial accountant is required to determine the amount of money the company used to purchase property, plant, and equipment (PP\&E) during the year. The balance of PP\&E at the beginning of the year is $1,350,000 and the balance of PP\&E at the end of the year is $2,750,000. The managerial accountant reviewed the general journal and noticed that the original cost of equipment sold during the year was $30,000. Using the following information, calculate the amount of cash the company paid in cash to purchase new property, plant, and equipment during the year: A. $2,750,000 B. $1,430,000 C. $1,350,000 D. $30,000 Using the direct method to prepare the statement of cash flows, cash payments for merchandise inventory is categorized on the statement of cash flows as A. a cash receipt in the operating activities section on the statement of cash flows. B. a cash payment in the operating activities section on the statement of cash flows. C. a cash receipt in the investing activities section on the statement of cash flows. D. a cash payment in the investing activities section on the statement of cash flows. In a company that uses the direct method to prepare the statement of cash flows, the amount of cash it uses to purchase inventory is computed as A. cost of goods sold plus ending inventory, minus beginning inventory. B. beginning inventory minus ending inventory, minus cost of goods sold. C. cost of goods sold plus ending inventory, plus beginning inventory. D. cost of goods sold plus ending inventory