The ratio of fixed assets to long-term liabilities provides a measure of a firm's ability to pay dividends.

Question

Quizplus · Accepted Answer

The ratio of fixed assets to long-term liabilities measures the extent to which a company's assets are financed by long-term debt. It does not directly indicate the firm's ability to pay dividends, which depends on a variety of factors including cash flow, profitability, and management decisions.

The Ratio of Fixed Assets to Long-Term Liabilities Provides a Measure