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Can someone help me with this, please?
Debt to Equity Ratio for: 2005 2006
22.51 17.11
Question: “An audit finding consistent with change in debt to equity ratio is:”
A. The company was able to purchase substantial operating assets through issuance of additional long term debt.
B. The company generated profit during the year.
C. The company was able to decrease its interest expense due to changes in the market.
The answer is obviously B, but can’t the answer also be C? Since decrease in interest expense will increase SHE and as a result, decrease debt to equity ratio?
Thank you in advance!
CA Candidate
F- 68, 78 (Thank you, Lord)
A- 75 (Thank you, Lord God)
R- 72, 75 (Thank you, Lord God Almighty)
B- 74, 77 (Thank you, Lord God Almighty Forever!) DONE!!Education - Completed
Ethics Exam - 100%
Experience - In Progress“Faith is believing that God is going to take you places before you even get there.” - Matthew Barnett
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