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Question
The debt ratio refers to the ratio of long-term debt to total external and _________.
The debt ratio refers to the ratio of long-term debt to total external and _________.
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Solution
The correct option is B Internal funds
Debt ratio refers to the ratio of long-term debt to the total of external and internal funds. It compares total debts to its total assets. It is a financial ratio that measures the extent of the company's leverage.Low ratio provides security to creditors and high ratio helps management in trading on equity.
Debt ratio refers to the ratio of long-term debt to the total of external and internal funds. It compares total debts to its total assets.
It is a financial ratio that measures the extent of the company's leverage.
Low ratio provides security to creditors and high ratio helps management in trading on equity.
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