Which of the Following Statements Describing the Debt Ratio Is

question 95

Multiple Choice

Which of the following statements describing the debt ratio is ?

• A) It is of use to both internal and external users of accounting information.
• B) A relatively high ratio is always desirable.
• C) The dividing line for a high and low ratio varies from industry to industry.
• D) Many factors such as a company's age, stability, profitability and cash flow influence the determination of what would be interpreted as a high versus a low ratio.
• E) The ratio might be used to help determine if a company is capable of increasing its income by obtaining further debt.

---

Definitions:

Recurrent

Occurring repeatedly over time; used to describe episodes of illness or events that happen time and again.

Arousal

A physiological and psychological state of being awake or reactive to stimuli, often associated with increased heart rate, alertness, and readiness to respond.

Transvestic Disorder

A condition characterized by an intense sexual arousal from cross-dressing which causes distress or impairment in social, occupational, or other important areas of functioning.

Transsexualism

The condition of identifying with a gender that is not the same as one's assigned gender at birth, often involving a transition process.