
Bundle: Financial & Managerial Accounting, Loose-leaf Version, 13th + CengageNOWv2, 1 term (6 months) Printed Access Card Corporate Financial ... Access Card for Managerial Accounting, 13th
13th Edition
ISBN: 9781305781429
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 1, Problem 1.8BPE
(a)
To determine
Ratio of liabilities to owners’ equity:
This ratio measures the claims of creditors over claims of owners in financing the assets. A lower ratio indicates that the company has good ability to pay off the creditors’ obligations.
Formula of ratio of liabilities to owners’ equity:
Ratio of liabilities to owners’ equity = Total liabilitiesTotal owners’ equity
To determine: Ratio of liabilities to owners’ equity of Company A
(b)
To determine
Whether the creditor’s risk of Company A has increased or decreased from December 31, 2015 to December 31, 2016.
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Chapter 1 Solutions
Bundle: Financial & Managerial Accounting, Loose-leaf Version, 13th + CengageNOWv2, 1 term (6 months) Printed Access Card Corporate Financial ... Access Card for Managerial Accounting, 13th
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