The Debt Ratio of Jackson's Shoes Is

question 64

Multiple Choice

The debt ratio of Jackson's Shoes is .9 and the debt ratio of Billy's Catering is 1.0. Based on this information, an investor can conclude:

• A) Billy's Catering has a lower risk from its financial leverage.
• B) Billy's Catering has the exact same dollar amount of total liabilities and total assets.
• C) Billy's Catering finances a relatively lower portion of its assets with liabilities than Jackson's Shoes.
• D) Jackson's Shoes has a higher risk from its financial leverage.
• E) Jackson's Shoes has less equity per dollar of assets than Billy's Catering.

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Definitions:

Emergency Braking

The act of applying the brakes quickly and forcefully to stop a vehicle in the shortest possible distance in response to an emergency.

Significant Loss

A considerable reduction in value, functionality, or quantity of something, often financially quantified.

Secondary Circuit

An auxiliary or additional circuit that works alongside or provides support to the main electrical circuit.

Steering Column

The shaft or column that connects the steering wheel to the steering mechanism, facilitating vehicle steering control.