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Jenny Lid. has the following assets and liabilities Cash: $10,000 Inventory: $100,000 Trade accounts receivable: $50,000 Long term assets (net of depreciation):
Jenny Lid. has the following assets and liabilities
• Cash: $10,000
• Inventory: $100,000
• Trade accounts receivable: $50,000
Long term assets (net of depreciation): $190,000
• Trade accounts payable: $150,000
• Long-term debt: $100,000
Required
(a) Calculate the debt to equity ratio.
(b) Calculate the debt to assets ratio.
(c) Comment on the leverage of the company.
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Financial and Managerial Accounting the basis for business decisions
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
16th edition
0077664078, 978-0077664077, 78111048, 978-0078111044
