Firm is considering actions which will raise its debt ratio

Assignment Help Financial Management

Reference no: EM131011760

A firm is considering actions which will raise its debt ratio. It is anticipated that these actions will have no effect on sales, operating income, or on the firm's total assets. If the firm does increase its debt ratio, which of the following will occur?

Return on assets will increase.

Times interest earned will increase.

Profit margin will decrease.

Total assets turnover will increase.

Reference no: EM131011760

Questions Cloud

What inventory method is used to value inventories : What inventory method is used to value inventories? Has Walgreen experienced inflation or deflation? Explain your answer. Explain the reference in the inventory note to the LIFO liquidation and what it means with regard to net income reported.

Translating research questions into hypotheses : Census Bureau data show that the mean household income in the area served by a shopping mall is $62,500 per year. A market research ?rm questions shoppers at the mall to ?nd out whether the mean household income of mall shoppers is higher than tha..

Lease the equipment or borrow the money : Penn Medical Center, a for-profit hospital, is considering the purchase of a new 64-slice CT scanner. The cost of the new scanner is $4 million and will be depreciated over 10 years on a straight line basis to $0 savage value. The tax rate is 40%. Th..

Enterobacter aerogenes : Please determine whether positive or negative for each bacterium Enterobacter aerogenes acid from glucose

Firm is considering actions which will raise its debt ratio : A firm is considering actions which will raise its debt ratio. It is anticipated that these actions will have no effect on sales, operating income, or on the firm's total assets. If the firm does increase its debt ratio, which of the following will o..

Even more on determining hypotheses : In each of the following situations, state an appropriate null hypothesis H0 and alternative hypothesis Ha. Be sure to identify the parameters that you use to state the hypotheses. (We have not yet learned how to test these hypotheses.)

Explore the potential legal liability : Explaining why you believe a jury would find the product to be unreasonably dangerous in its current condition. Explore the potential legal liability of that merchant and manufacturer

Manufactures and markets variety of toy products worldwide : It is January 2010 and as the Chief Executive Officer of TM Toys Inc. you are evaluating a strategic acquisition of Toy Co. Inc. Toy Co. Inc. designs, manufactures and markets a variety of toy products worldwide through sales to retailers and wholesa..

A case-crossover study design be appropriate : For which of the following study questions would a case-crossover study design be appropriate?

User Account

All Pages