When a Firm's Long-Term Debt-Equity Ratio Is

question 83

Multiple Choice

When a firm's long-term debt-equity ratio is .98,the firm:

• A) has too much long-term debt in relation to leases.
• B) has less long-term debt than equity.
• C) is nearing insolvency.
• D) has as much in long-term liabilities as in equity.

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Definitions:

Cash

A form of liquid asset that represents money in physical form, such as banknotes and coins.

Employer

An entity or individual that hires employees or workers.

Pension Expense

The cost recognized by an employer for maintaining a pension plan for its employees over a period.

Actual Return

The real gain or loss achieved on an investment over a specific period, including interest, dividends, and capital gains.