Question
The following information was taken from Kellman Company's balance sheet: Fixed assets (net) $2,000,000 Long-term liabilities 800,000 Total liabilities 1,000,000 Total stockholders equity 625,000 Determine
The following information was taken from Kellman Company's balance sheet:
Fixed assets (net) | $2,000,000 |
Long-term liabilities | 800,000 |
Total liabilities | 1,000,000 |
Total stockholders equity | 625,000 |
Determine the company's (a) The ratio of fixed assets to long-term liabilities provides a measure of whether note-holders or bondholders will be paid.ratio of fixed assets to long-term liabilities and (b) The ratio of liabilities to stockholders' equity measures how much of the company is financed by debt and equity.ratio of liabilities to stockholders' equity. If required, round your answers to one decimal place.
a. Ratio of fixed assets to long-term liabilities
b. Ratio of liabilities to stockholders' equity
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