Define the Following Two Ratios and Briefly Discuss the Information

question 8

Essay

Define the following two ratios and briefly discuss the information provided by them:
a.debt ratio
b.times-interest-earned ratio

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Definitions:

Journal Entries

Records of financial transactions in accounting, which are entered in the chronological order.

Transactions

The activities or dealings that involve the transfer of goods, services, money, or titles between parties, forming the basis of accounting records.

Asset Account

An account that represents a resource owned by a business from which future economic benefits are expected.

Expense Account

An account used to record expenses incurred by a business, which are then used to reduce income on the profit and loss statement.