Indicate whether each of the following statements about financial statement analysis is true or false.The ratio of plant assets to long-term liabilities is a measure of a company's ability to obtain additional long-term financing. ______Generally, a company's current assets should be purchased using long-term financing such as bonds payable. ______Ratios that measure a company's profitability provide some measure of the effectiveness of the company's management. ______Net margin indicates the amount remaining from each sales dollar after cost of goods sold has been subtracted out. ______Net margin is also sometimes called the return on assets ratio. ______
What will be an ideal response?
The ratio of plant assets to long-term liabilities is a measure of a company's ability to obtain additional long-term financing. T
Generally, a company's current assets should be purchased using long-term financing such as bonds payable. F
Ratios that measure a company's profitability provide some measure of the effectiveness of the company's management. T
Net margin indicates the amount remaining from each sales dollar after cost of goods sold has been subtracted out. F
Net margin is also sometimes called the return on assets ratio. F
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