This problem asks you to evaluate a major increase in financial leverage on the part of Avon Products Inc. The company's financial statements for 2001-2003 and specific questions are available for download at www.mhhe.com/higgins9e. (Select Student Edition > Choose a Chapter > Excel Spreadsheets.) You may also find it useful to consult the company's past annual reports (10-Ks) available at www.secinfo.com.

AppendixLO1