The president of Lake Louise Ltd wants to know the effect that the following events would have on users' perceptions of the company.Complete the following list by indicating whether the event listed would increase, decrease or have no effect on the financial measures listed.State any assumptions you make.Lake Louise Ltd has a December 31 year-end. $$\begin{array}{l}
\text { Ratio before event: }\
\begin{array} { l l }
\hline\text { Debt-to-equity: } & .80 \
\text { Current ratio: } & 1.5 \
\text { Interest coverage: } & 5.5 \
\text { Cash from operations: } &\$ 850,000 \
\text { Return on assets: } & 6.2 \%
\end{array}
\end{array}$$ A) Received cash for services to be provided next year.B) Paid the balance outstanding on their line of credit.

Question

The president of Lake Louise Ltd wants to know the effect that the following events would have on users' perceptions of the company.Complete the following list by indicating whether the event listed would increase, decrease or have no effect on the financial measures listed.State any assumptions you make.Lake Louise Ltd has a December 31 year-end. $$\begin{array}{l}
\text { Ratio before event: }\
\begin{array} { l l } 
\hline\text { Debt-to-equity: } & .80 \
\text { Current ratio: } & 1.5 \
\text { Interest coverage: } & 5.5 \
\text { Cash from operations: } &\$ 850,000 \
\text { Return on assets: } & 6.2 \%
\end{array}
\end{array}$$ A) Received cash for services to be provided next year.B) Paid the balance outstanding on their line of credit.

Quizplus · Accepted Answer

The Answer of The president of Lake Louise Ltd wants to know the effect that the following events would have on users' perceptions of the company.Complete the following list by indicating whether the event listed would increase, decrease or have no effect on the financial measures listed.State any assumptions you make.Lake Louise Ltd has a December 31 year-end. $$\begin{array}{l}
\text { Ratio before event: }\
\begin{array} { l l } 
\hline\text { Debt-to-equity: } & .80 \
\text { Current ratio: } & 1.5 \
\text { Interest coverage: } & 5.5 \
\text { Cash from operations: } &\$ 850,000 \
\text { Return on assets: } & 6.2 \%
\end{array}
\end{array}$$ A) Received cash for services to be provided next year.B) Paid the balance outstanding on their line of credit.

The President of Lake Louise Ltd Wants to Know the Effect