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Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767 Exercise 14
Debt Ratio, Debt-to-Equity Ratio
Busch Company's balance sheet shows total liabilities of $510,900, total equity of $126,000, and total assets of $636,900.
Required:
Note : Round answers to two decimal places.
1. Calculate the debt ratio.
2. Calculate the debt-to-equity ratio.
3. CONCEPTUAL CONNECTION Based on the ratios calculated in Requirements 1 and 2, comment on the riskiness of Busch's financing decisions.
Busch Company's balance sheet shows total liabilities of $510,900, total equity of $126,000, and total assets of $636,900.
Required:
Note : Round answers to two decimal places.
1. Calculate the debt ratio.
2. Calculate the debt-to-equity ratio.
3. CONCEPTUAL CONNECTION Based on the ratios calculated in Requirements 1 and 2, comment on the riskiness of Busch's financing decisions.
Explanation
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Solvency ratio is calculated in order to...
Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
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