Company X is competing with company Y. These are their ratios:xyDebt Ratio = .437Debt Ratio = .599Debt Equity Ratio = .453Debt Equity Ratio = .965Interest Earned = 15.854Interest Earned = 5.67Based on Long-Term Debt paying ability, are any of them doing well? which company is doing better?

Debt ratio tells the relationship between total debt and total assets of a company. In other words,…

Answered: Based on Long-Term Debt paying ability,…

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Based on Long-Term Debt paying ability, are any of them doing well? which company is doing better?

Cornerstones of Cost Management (Cornerstones Series)

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Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter10: Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing

Section: Chapter Questions

Problem 24E: A company had WACC (weighted average cost of capital) equal to 8. % If the company pays off mortgage...

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Question

100%

Company X is competing with company Y. These are their ratios:

x	y
Debt Ratio = .437	Debt Ratio = .599
Debt Equity Ratio = .453	Debt Equity Ratio = .965
Interest Earned = 15.854	Interest Earned = 5.67

Based on Long-Term Debt paying ability, are any of them doing well? which company is doing better?

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