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Jenny Ltd. 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
Jenny Ltd. 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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a The debt to equity ratio is calculated by dividing the total debt by the total equity Debt to equi...
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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
