1. A company total debt ratio measures the total debt to total assets:

   Suppose the company total debt = $951.8 and total assets = $1889.2

   a) What is the Total Debt Ratio

   b) Interpret the ratio

2. The liquidity ratios focus on whether the firm has the ability to convert its current asset into cash without a significant loss.

   One such liquidity ratio is the current ratios = Current Assets/ Current Liability

   Suppose Current Asset = $1039.8 and Current Liability = $377.8 and inventory = $750.

   a) Compute the Liquidity or quick ratioCurrent

   b) Interpret the ratio