Discuss the cash burn ratio

Reference no: EM131522752

Question: [Transaction effects on ratios, CFA C adapted] A company's current ratio is 2.0. The company uses some of its cash to retire notes payable that are due %Mit arc year.

a. Descend be the effect of this transaction on the company's

(i) Current ratio

(ii) Asset turnover ratio

(iii) Cash burn ratio

(iv) Debt-to-equity ratio

b. Redo part a assuming that the company's current ratio was 0 R at the time of the transaction.

Reference no: EM131522752

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