A Firm Has a Total Debt Ratio of

question 25

Multiple Choice

A firm has a total debt ratio of .47. This means that that firm has 47 cents in debt for every:

• A) $1 in equity.
• B) $1 in total sales.
• C) $1 in current assets.
• D) $.53 in equity.
• E) $.53 in total assets.

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Definitions:

Issuance

The process of making securities available for sale by a company, typically involving stocks or bonds.

Capital Stock

The total amount of shares a company is authorized to issue, representing the owners' equity in the corporation.

Investing Activity

Financial activities related to the acquisition and sale of long-term assets and other investments not considered cash equivalents.

Income Statement

A fiscal statement detailing a firm's income, expenditures, and earnings during a determined timeframe.