1. 1. Name the ratios which are useful in assessing a) liquidity b) solvency and c) profitability.
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2. Danielle Smith, the founder of Pretty Feet, Inc. needs to raise $600,000 to expand her company's operations. She has been told raising the money through debt will increase the riskiness of her company much more than issuing stock. She doesn't understand why this is true. Explain this to us.

3. If Danielle Smith was to go through a bank loan what would the bank want to see to support this request? Which ratios would the bank be looking for?

Answer rating: 100% (QA)

1 a Liquidity ratios The current ratio and the quick ratio are two examples b Solvency ratios Intere... View the full answer