a.
Concept Introduction:
Debt ratio: The debt ratio measures the percentage of shares financed by debt, the higher debt ratio is considered riskier for the business, because higher debt ratio indicates the larger portion of assets are funded by external debt, it is computed as total liabilities divided by the total of assets.
The Debt ratio for A in the current year and the prior year.
b.
Concept Introduction:
Debt ratio: Debt ratio measures the percentage of shares financed by debt, the higher debt ratio is considered riskier for the business, because a higher debt ratio indicates a larger portion of assets are funded by external debt, it is computed as total liabilities divided by the total of assets.
The company has a high degree of financial leverage.
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FINANCIAL+MANAG.ACCT.
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- What do the liquldity ratlos tell you In the financlal analysis? 1 The capital structure of a company 2 The profitability of the company 3. The efficiency of inventory 4. The company's ability to pay off debt obligations 5. Ratios analysisarrow_forwardA-1: determine the amount of current assets and current liabilities for each company A-2: compute the current ratio for each company B: assuming that all assets and liabilities are listed above, compute the debt to assets ratio for each company C-1: determine which company has the greater finiancial risk in the short term C-2: determine which company has the greater financial risk in the long termarrow_forwardThe debt to assets ratio measures the proportion of interest paid relative to dividends paid. the company's profitability. O whether interest can be paid on debt in the current year. O the percentage of the total assets provided by creditors.arrow_forward
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