All of the Following Statements Accurately Describe the Debt Ratio

question 58

Multiple Choice

All of the following statements accurately describe the debt ratio except.

• A)It is of use to both internal and external users of accounting information.
• B)A relatively high ratio is always desirable.
• C)The dividing line for a high and low ratio varies from industry to industry.
• D)Many factors such as a company's age,stability,profitability and cash flow influence the determination of what would be interpreted as a high versus a low ratio.
• E)The ratio might be used to help determine if a company is capable of increasing its income by obtaining further debt.

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Definitions:

Scent

The particular smell of an object, substance, or area, often processed and recognized by the olfactory system.

Olfactory Receptors

specialized nerve cells responsible for the sense of smell, located in the nasal cavity.

Odorant

Odorant refers to any substance capable of eliciting an olfactory response, meaning it has a smell that can be detected by the sensory receptors in the nose.

Scents

Volatile substances that can be perceived by the olfactory system, contributing to the sense of smell.