AFP
CTP · Question #688
(Topic 7) BF Company, a manufacturer of food products, reported financial information shown in the Exhibit for the end of the year. BF Company is subject to covenants in its commercial paper…
The correct answer is A. Maximum long-term debt to capital of 52.5%. See the full explanation below for the reasoning.
Question
- (Topic 7)
BF Company, a manufacturer of food products, reported financial information shown in the Exhibit for the end of the year. BF Company is subject to covenants in its commercial paper program. It is in compliance with which of the following?
Options
- AMaximum long-term debt to capital of 52.5%
- BMinimum working capital of $10,000
- CMaximum dividends of 50% of net income
- DMinimum cash flow to total debt of 45%
How the community answered
(28 responses)- A75% (21)
- B7% (2)
- C14% (4)
- D4% (1)
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