Which of the Following Ratios Provides a Solvency Measure That

question 17

Multiple Choice

Which of the following ratios provides a solvency measure that shows the margin of safety of noteholders or bondholders and also gives an indication of the potential ability of the business to borrow additional funds on a long-term basis?

• A) Ratio of net sales to assets
• B) Rate earned on stockholders' equity
• C) Number of days' sales in receivables
• D) Ratio of fixed assets to long-term liabilities

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Definitions:

Weak Ego

Indicates an individual's lack of strength or development in the ego, affecting their self-esteem and ability to manage impulses.

Collectivism

The principle or practice of giving a group's needs and goals precedence over individual desires or ambitions.

Individualist Cultures

Societies that emphasize personal achievement, autonomy, and individual rights, often prioritizing individual goals over group objectives.

Family Obligations

The responsibilities and duties that individuals may have towards their family members.