Discover answers to your questions with Westonci.ca, the leading Q&A platform that connects you with knowledgeable experts. Our platform offers a seamless experience for finding reliable answers from a network of experienced professionals. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts.
Sagot :
firm's debt-equity ratio = 0.16
What is meant by debt-equity ratio?
The debt-equity ratio is a term used in accounting to define a company's financial structure. By directly dividing a company's total debt by its total equity, this ratio is calculated.
Financial ratios are statistics derived from financial statements of an organization that analysts may use to evaluate business performance and benchmark against other businesses in the same industry.
The primary categories into which the financial ratios may be subdivided are liquidity ratios, solvency ratios, profitability ratios, and market outlook ratios. Each class will focus on a distinct element of the business.
Analysts should, however, assess the accuracy and transparency of the supplied financial figures before beginning their research. Some internal investors may alter the financial figures in order to benefit themselves.
ROE = profit margin × asset turnover × equity multiplier
18.62% = 10.70% × 1.50 × equity multiplier
equity multiplier = 1.16
Then debt-equity ratio is calculated as:
debt-equity ratio = equity multiplier - 1
debt-equity ratio = 1.16 - 1
debt-equity ratio = 0.16
To learn more about debt-equity ratio from given link
https://brainly.com/question/27996292
#SPJ4
Thank you for choosing our platform. We're dedicated to providing the best answers for all your questions. Visit us again. We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. Thank you for visiting Westonci.ca, your go-to source for reliable answers. Come back soon for more expert insights.
