Q. Which of the following statements (in general) is correct? (Solved)
1. A low receivables turnover is desirable.
2. The lower the total debt-to-equity ratio, the lower the financial risk for a firm.
3. An increase in net profit margin with no change in sales or assets means a poor ROI.
4. The higher the tax rate for a firm, the lower the interest coverage ratio.
- b. The lower the total debt-to-equity ratio, the lower the financial risk for a firm.