The ________ ratio measures the proportion of total assets financed by the firm's creditors.

Question

Quizplus · Accepted Answer

The debt ratio measures the portion of total assets financed by the firm through borrowed funds, which are the creditors. Therefore, the correct choice is D - debt ratio. The total asset turnover measures how efficiently the firm is utilizing its assets to generate sales, inventory turnover measures how quickly the firm is selling its inventory, and the current ratio measures the firm's ability to meet its short-term obligations. None of these ratios measure the proportion of total assets financed by the firm's creditors.

The ________ Ratio Measures the Proportion of Total Assets Financed