Which of the Following Ratios Is Determined by Dividing Total

question 49

Multiple Choice

Which of the following ratios is determined by dividing total liabilities by total owners' equity?

• A) The acid test
• B) Debt to equity ratio
• C) The quick ratio
• D) Return on equity

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Definitions:

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Advertising Campaign

A series of advertisement messages that share a single idea and theme intended to achieve specific business objectives.

Contribution Margin Ratio

A measure of how a company's sales revenue contributes to covering its variable costs.

Fixed Costs

Expenses that do not change in total volume with changes in the level of business activity, such as rent or salaries.