Which of the Following Classifications of Ratios Measures the Degree

question 73

Multiple Choice

Which of the following classifications of ratios measures the degree and effect of the company's use of borrowed funds to finance its operations?

• A) liquidity
• B) debt
• C) equity
• D) profitability

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Definitions:

Legal Obligations

Duties imposed by law requiring individuals or organizations to comply with legal standards and regulations.

Operation of Law

Changes in legal status or rights triggered automatically by law, not requiring action by individuals.

Courts

Institutions that interpret and apply the law to resolve disputes.

Legal Obligations

Duties that are enforceable by law, arising from statutes, contracts, or legal principles.