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A company has total assets of $1,000,000 and total liabilities of $400,000. If the owner's equity is $600,000, calculate the debt ratio and discuss its

· A company has total assets of $1,000,000 and total liabilities of $400,000. If the owner's equity is $600,000, calculate the debt ratio and discuss its implications for the company's financial leverage and risk management. Delve into the significance of debt financing in capital structure decisions, weighing the benefits of leverage against the potential risks of financial distress and increased interest expenses.

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