The debt to equity ratio of four companies is given below. $$\begin{array} { | l | c | }
\hline & \text { Debt to equity ratio } \
\hline \text { Lewis, Inc. } & 1.30 \
\hline \text { Tackson, Inc. } & 1.50 \
\hline \text { Tones Corp. } & 0.88 \
\hline \text { Roberts Corp. } & 0.92 \
\hline
\end{array}$$
-Which of the following companies has the greatest financial risk?

Question

The debt to equity ratio of four companies is given below. $$\begin{array} { | l | c | } 
\hline & \text { Debt to equity ratio } \
\hline \text { Lewis, Inc. } & 1.30 \
\hline \text { Tackson, Inc. } & 1.50 \
\hline \text { Tones Corp. } & 0.88 \
\hline \text { Roberts Corp. } & 0.92 \
\hline
\end{array}$$ 
-Which of the following companies has the greatest financial risk?

Quizplus · Accepted Answer

The company with the highest debt to equity ratio, Tackson, Inc. (1.50), has the greatest financial risk as it indicates a higher proportion of debt financing relative to equity financing.

The Debt to Equity Ratio of Four Companies Is Given