Answer:
0.90
Explanation:
The debt to equity ratio is a type of leverage ratio. It is also known as a risk ratio. It is calculated using the formula below.
Debt to Equity Ratio=Total Shareholders Equity/ Total Liabilities.
Shareholders' equity is comprised of retained earnings, share capital, income, and dividends.
Total liabilities are the current liabilities plus long term liabilities.
For Creatz Ltd, Total liabilities are $3500 + $7500= $11,000
Shareholders is $10,000
debt to equity ration
= $10,000/$11,000
=0.90
Answer:
Given that Honduras is a small economy in Central America, and it keeps a fixed exchange rate with the US, and capital is perfectly mobile, but interest rates are three percent in the US and six percent in Honduras, the explanation of the difference in these interest rates are as follows:
Honduras has a higher interest rate, meaning that its sovereign bonds pay higher values than the American ones, as well as its banks also pay higher interests on their investments compared to American banks.
This is so for a double reason: on the one hand, because the Honduran economy is less reliable than the American economy, which is larger and therefore more solvent and capable of overcoming eventual crises, with which the risk of default is less.
On the other hand, the Honduran economy is more dependent on foreign investment, so it must offer higher interest rates to attract such investments.
Answer: The correct answer is "(A) Materiality.".
Explanation: The concept demonstrated is Materiality because by having a mechanism for preventing bad accounts through their strict requirements, they only recorded bad accounts when they actually existed, instead of making a provision.
The answer to the question you are asking is e
