Asked by Chelsy Martin on May 26, 2024

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If management wishes to evaluate the amount of assets which were financed by creditors, they could use the:

A) debt to total assets.
B) rate of return on common stockholders' equity.
C) debt to total liabilities.
D) times interest earned.

Debt to Assets

A financial ratio that measures the proportion of a company’s total debt to its total assets, indicating the degree of leverage.

Financed by Creditors

A phrase indicating that a portion of a company's funding or assets has been obtained through borrowing from lenders.

Total Assets

The sum of all owned resources (assets) that have economic value which a company or individual possesses.

  • Compute the ratios of debt to total assets and debt to stockholders' equity, and comprehend their significances.
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Nurul ArdianMay 28, 2024
Final Answer :
A
Explanation :
The debt to total assets ratio is used to evaluate the amount of assets financed by creditors, as it measures the proportion of a company's assets that are financed by debt.