When examining the debt/equity ratio of a company, consideration should be given to pension liabilities. Specifically, it should be determined if the projected benefit obligation significantly exceeds the plan assets, and if it does compare this to any liability recorded on balance sheet.

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This is because pension liabilities can be a major source of debt for a company and can have a significant impact on its debt/equity ratio. It is important to take these liabilities into account when analyzing a company's financial position.

When Examining the Debt/equity Ratio of a Company, Consideration Should