18. If Tim Jones, the owner of Jones Hardware proprietorship, uses cash of the business to purchase a family automobile, the business should record this use of cash with a journal entry to: A. Debit Salary Expense and credit Cash. B. Debit Tim Jones, Salary and credit Cash. C. Debit Cash and credit Tim Jones, Withdrawals. D. Debit Tim Jones, Withdrawals and credit Cash. E. Debit Automobiles and credit Cash. 19. The debt ratio is used: A. To measure the relation of equity to expenses. B. To reflect the risk associated with a company's debts. C. Only by banks when a business applies for a loan. D. To determine how much debt a firm should pay off E. All of these. 20. Which of the following statements is incorrect? A. Higher financial leverage involves higher risk. B. Risk is higher if a company has more liabilities. C. Risk is higher if a company has higher assets. D. The debt ratio is one measure of financial risk. E. Lower financial leverage involvs lower risk