Husky inc has total asset of 12 million and total liabilities of 8 million . If

Question

Husky inc has total asset of 12 million and total liabilities of 8 million . If the firm reduces its cash account balance by 1 million and uses it to pay off long term debt then 1 the current ratio will rise 2-EPS will rise 3- the debt to ratio wil fall 4- total assets will be unchanged 5- none of the statements are correct Husky inc has total asset of 12 million and total liabilities of 8 million . If the firm reduces its cash account balance by 1 million and uses it to pay off long term debt then 1 the current ratio will rise 2-EPS will rise 3- the debt to ratio wil fall 4- total assets will be unchanged 5- none of the statements are correct 1 the current ratio will rise 2-EPS will rise 3- the debt to ratio wil fall 4- total assets will be unchanged 5- none of the statements are correct

Explanation / Answer

Husky inc has total asset of 12 million and total liabilities of 8 million . If the firm reduces its cash account balance by 1 million and uses it to pay off long term debt then the debt ratio will fall.

After cash payment of $ 1 million to long term debt, then the debt ratio will fall.

The Long term debt reduced by $ 1 million.

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