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The company has the following ratios: Debt to Equity (DTE) ratio 1.8:1, Return on asset (ROA) 10 per cent; and Quick ratio (QR) of 1:1.
The company has the following ratios: Debt to Equity (DTE) ratio 1.8:1, Return on asset (ROA) 10 per cent; and Quick ratio (QR) of 1:1. In the current financial year, the company revalued a piece of land from $4 million to $5 million (the land is revalued for the first time). How does the revaluation in the current financial year affect the ratios? Select one: O a. decrease QR but have no effect on ROA or DTE. O b. no effect on these three ratios O c. decrease ROA and DTE but have no effect on QR. O d. increase ROA and DTE but decrease QR. e. decrease ROA and QR but have no effect on DTE
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