Answer:
The lower ratio of long-term debt to total capital is explained by the fact that the company is not highly geared or leveraged in comparison to the industry average firm.
This also explains why the ratio of income before interest and taxes to the debt interest charges is higher than the industry average because the firm does not pay so much in interest expense as the average firm in its industry.
Explanation:
Company X's leverage determines its ratio of long-term debts to total capital. If Company X has large long-term debts it will have a higher long-term debts to total capital ratio and vice versa. In that situation, Company X will also pay more in interest, causing its ratio of income before interest and taxes to the interest charges to be higher than the industry average, and vice versa.
Answer:
Explanation: If the credit risk in the banking system increases, it is normal and even beneficial because if there is credit the economy moves, and obviously it advances since this allows the banks to multiply the money, but if said credit increase, it is given in a way uncontrolled can cause the economy to warm up, leading to financial bubbles.
Answer:
False
Explanation:
The economic systems are hard to change even, when the result are quite clear. For Cuba North Korea and other, to embrace socialism a revolution / war occrur. To leave communinst economy the soviet union had to be compeltely broken in every other aspect as well. Government do not change their foundation every once in a while.
To change their economic and political system countries pretty much have to go through tears and blood.
Answer:
The required adjusting journal entry on December 31 includes a:
Debit Insurance Expense $400
Credits Prepaid Insurance $400
Explanation:
On Dec. 1, a 12-month insurance policy was purchased and paid in advance for $4,800. The company records the insurance as the prepaid Insurance:
Debit Prepaid Insurance $4,800
Credit Cash $4,800
On December 31, the last day of the following 1 months, the company records an adjusting entry that Credits Prepaid Insurance for $400 ($4,800 divided by 12 months times the 1 months that will be prepaid as of December 31) and Debits Insurance Expense for $400
Debit Insurance Expense $400
Credits Prepaid Insurance $400