Table 14.2 Assets Current assets Fixed assets Total Flum Packages, Inc. OA. 2:3 OB. 1:3 O C. 3:1 OD. 2:1 $10,000 20,000 $30,000 Liabilities & Equity Current Liabilities Long-term debt Equity Total $5,000 12.000 13,000 $30,000 The company earns 5 percent on current assets and 15 percent on fixed assets. The firm's current liabilities cost 7 percent to maintain and the average annual cost of long-term funds is 20 percent. The firm's initial ratio of current assets to total assets is (See Table 14.2)

Table 14.2 The company earns 5 percent on current assets and 15 percent on fixed assets. The firm's current liabilities cost 7 percent to maintain and the average annual cost of long-term funds is 20 percent. The firm's initial ratio of current assets to total assets is (See Table 14.2) A. 2:3 B. 1:3 C. 3:1 D. 2:1