Which of the following statements is not true? A. The sum of the debt ratio and the equity ratio does not have to equal 100%. B. The debt ratio indicates how many dollars of debt exist per dollar of assets. C. If the debt to equity ratio is more than 100%, the entity is more reliant on debt funding than equity funding. D. If the equity ratio is less than 50% then the entity is more reliant on debt funding than equity funding.

Which of the following statements is incorrect?1 pointThe higher the debt-to-equity ratio, the more profit the company has recordedThe higher the debt-to-equity ratio, the more debt the company has on its balance sheetA high debt-to-equity ratio means the company has a lot of debt in relation to equityThe debt-to-equity ratio analyzes the relationship between total liabilities and total equity

Which one of the following statements is true?Group of answer choicesLow debt ratio means most of the assets are financed by debt.Low debt ratio means most of the assets are financed by equity.Too little debt will reduce the business’s long-term flexibility.High debt ratio means most of the assets are financed by equity.

Which of the following statements is NOT TRUE?Debt is costlier than equity.For the same business the firm can choose between the use of debt capital versus equity capital.Net profit can be substantially higher if debt is usedAll of the above

Which of the following statements regarding equity is not true?It is defined independently of assets and liabilities.It can be increased by additional contributions by the owners.It is increased by profit.It includes the retained earnings of the entity.

1.Question 1If a firm has a debt-to-equity ratio of 20%, then a firmborrows $1 for every $____ in equity.