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Bathlinks Corporation Has a Debt to Assets Ratio of 73

Question 132

Multiple Choice

Bathlinks Corporation has a debt to assets ratio of 73%.This tells the user of Bathlinks's financial statements that


A) Bathlinks is getting a 27% return on its assets.
B) there is a risk that Bathlinks cannot pay its debts as they come due.
C) 73% of the assets are financed by the stockholders.
D) based on this measure, the user should not invest in Bathlinks.

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