Question

Toms total assets are valued at $187,964 and total debt is $83,427. What is his total debt ratio, rounded to 2 decimal places?

Some numbers that Jean gathered to begin building her financial plan are as follows: Annual Expenses Current Assets Total Assets Current Liabilities $31,194 $6,342 $208,116 $1,325 $19,447 Fixed Expenses Net Income After Deductions $574 Calculate her current ratio to two decimal places.

Which of the following is a current asset? Monthly credit card bill. 1-year GIC 3-year GIC A car that is fully paid for.

Which of the Financial Planning Steps is missing? Gather and analyze financial information Develop the Financial Plan Implement the Financial Plan . Monitor the Financial Plan Create a balance sheet Establish goals Determine the current ratio Determine the asset allocation

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Answer #1

Answer(1): Total debt Ratio = Total Assets / Total debt

Total debt Ratio: 187964 / 83427

Total debt Ratio = 2.25

Answer(2): Current ratio = Current assets / Current liabilities

Current ratio: 6342 / 1325 = 4.78 : 1

Answer(3): 1 Year GIC is the current asset.

GIC is Guaranteed investment certificate that provides guaranteed return on the Canadian investment. it comes within one year investment so considered as Current asset.

Answer(4): "Evaluating financial plan or alternatives" is missing step here.

Financial planning process steps: Are as following

  1. Gather and analyze financial information
  2. Develop the financial plan
  3. Evaluate the financial plan
  4. Implement the financial plan
  5. Monitor and follow up the plan.

Please rate. Thanks

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