Firm a Has a Total Debt to Total Assets Ratio

question 139

Multiple Choice

Firm A has a total debt to total assets ratio of 50% and an interest coverage ratio of 1.0.Firm B has a total debt total assets ratio of 80% and an interest coverage ratio of 10.0.Based on this limited information firm ________ appears to be in ________ debt management position than firm ________.

• A)A, better, B
• B)B, better, A
• C)A, a comparable, B
• D)none of the above

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