Which Debt Ratio Would Indicate the BEST Overall Ability of an Organization

question 28

Multiple Choice

Which debt ratio would indicate the BEST overall ability of an organization to pay its debts?

• A)60%
• B)25%
• C)40%
• D)130%

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Definitions:

Administrative Costs

Expenses associated with daily operations of managing a business or organization, including office supplies, salaries of non-production staff, and utilities.

Customer Classification Departments

Divisions within a company that segment customers based on various criteria to tailor marketing and service delivery.

Mercy Medical Center

A healthcare institution providing medical care and services; without specific details, this can refer to any one of several hospitals by the same name in different locations.

Rule Utilitarianism

An ethical theory that suggests the rightness or wrongness of an action should be judged by the rules that are followed, and that these rules should be chosen based on the utility or happiness they produce.