A Company with Liabilities of $2,816,000 and Equity of $826,000

question 127

True/False

A company with liabilities of $2,816,000 and equity of $826,000 has a debt to equity ratio equal to 29.33%

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Definitions:

CCA Tax Shield

A tax deduction that allows businesses to depreciate the cost of tangible property or assets over time, reducing taxable income.

Discount Rate

In DCF analysis, this is the rate used to ascertain the present value of forthcoming cash flows.

Gear Ratio

The ratio between the rates at which the last and first gears in a series turn, affecting the vehicle's performance and fuel efficiency.