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danyyzz danyyzz
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10 months ago

Tweedle Corporation's most recent balance sheet and income statement appear below:

Balance Sheet
December 31, Year 2 and Year 1
(in thousands of dollars)
Year 2Year 1
Assets
Current assets:
Cash$ 140$ 130
Accounts receivable, net200210
Inventory150180
Prepaid expenses2020
Total current assets510540
Plant and equipment, net950910
Total assets$ 1,460$ 1,450
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable$ 130$ 150
Accrued liabilities7070
Notes payable, short term7060
Total current liabilities270280
Bonds payable170190
Total liabilities440470
Stockholders’ equity:
Common stock, $1 par value200200
Additional paid-in capital320320
Retained earnings500460
Total stockholders’ equity1,020980
Total liabilities & stockholders’ equity$ 1,460$ 1,450

Income Statement
For the Year Ended December 31, Year 2
(in thousands of dollars)
Sales (all on account)$ 1,190
Cost of goods sold710
Gross margin480
Selling and administrative expense226
Net operating income254
Interest expense25
Net income before taxes229
Income taxes (30%)69
Net income$ 160

The debt-to-equity ratio at the end of Year 2 is closest to:



▸ 0.43

▸ 0.24

▸ 0.17

▸ 0.54
Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
Authors:
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teamroketteamroket
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