When a company goes into debt,the debt ratio provides information about the risk created for the company's owners and lenders.

Question

Quizplus · Accepted Answer

The debt ratio is a financial ratio that measures the proportion of a company's total liabilities to its total assets. A high debt ratio indicates that a company has a high level of debt relative to its assets, which can increase the risk for both the owners and lenders. Therefore, the statement is true.

When a Company Goes into Debt,the Debt Ratio Provides Information