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Liabilities: Liabilities are debt and obligations of a business. These are the claims against the resources that a business owes to outsiders of the company. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.
To report: Liabilities on the balance sheet.
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Debt to equity ratio: Debt to equity ratio is used to evaluate the relationship between the total liabilities and total equity of the company. Debt to equity ratio helps the company to determine the proportion of debt and equity. When the ratio is greater than 1, then it is higher and thus, company faces higher risk. Debt to equity ratio is calculated by using the following formula:
To calculate: Debt to equity ratio.
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