The Following Selected Data Come from Celebration Company's Balance Sheets

question 24

Multiple Choice

 The following selected data come from Celebration Company's balance sheets over three recent years. Based on the data, what is Celebration's debt ratio for each of the three years, and do the ratios show deterioration or improvement in Celebration's leverage? Assume that the industry average is 0.30 or 30%. 

• A) 2.12; 2.17; 2.22; strong but deteriorating slightly
• B) 0.39; 0.40; 0.41; weak but improving slightly
• C) 2.56; 2.53; 2.46; strong and improving slightly
• D) 0.47; 0.46; 0.45; weak and deteriorating slightly

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