Increase the cost and amount of assets necessary to generate each dollar of sales because it will increase the company’s total assets turnover. Decrease the amount of debt financing us
Increase the cost and amount of assets necessary to generate each dollar of sales because it will increase the company’s total assets turnover. Decrease the amount of debt financing us
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Increase the cost and amount of assets necessary to generate each dollar of sales because it will increase the company’s total assets turnover.
Decrease the amount of debt financing used by the company, which will decrease the total assets turnover ratio.
Increase the interest rate on its notes payable or long-term debt obligations because it will reduce the company’s net profit margin.
Use more debt financing in its capital structure and increase the equity multiplier.
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