Question: True or False 1. The debt ratio is computed by dividing total liabilities by current assets. 2. Working capital is the excess of current assets

True or False

1. The debt ratio is computed by dividing total liabilities by current assets.

2. Working capital is the excess of current assets over current liabilities.

3. From a creditor's point of view, the lower the debt ratio; the safer the creditor's position.

4. The trend in ratios is usually more useful than looking at a single year's ratio.

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