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If a Company Has a Debt to Equity Ratio of 1:48

question 36

True/False

If a company has a debt to equity ratio of 1:48, it means that for every $1 of equity, the company has $1.48 in liabilities.


Definitions:

Incorporator

An individual or entity that establishes and files the legal documentation required to form and register a corporation.

Articles of Incorporation

A document filed with a state government to legally document the creation of a corporation.

Corporation

A legal entity that is separate and distinct from its owners, which can enter into contracts, own assets, sue and be sued.

Piercing the Corporate Veil

A legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders or directors.

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