If Topeka Enterprises Has a Debt Ratio of 40 Percent

question 24

Multiple Choice

If Topeka Enterprises has a debt ratio of 40 percent, it means that for every $1 in ______, the firm has 40 cents in ______.

• A) owners' equity; liabilities
• B) owners' equity; assets
• C) assets; owners' equity
• D) assets; liabilities

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Definitions:

Camouflaged Verbs

Verbs that are transformed into nouns or adjectives, often making sentences more complicated and harder to understand.

Acquisition

The process of gaining possession or control of something, such as a company purchasing another company or assets.

Liquidate

To convert assets into cash, often in the context of closing a business or paying off debt.

Abstract Words

Abstract words represent concepts or ideas that do not have a physical form, making them subjective and often open to interpretation.