127.Indicate whether each of the following statements about financial statement analysis is true or false.Solvency ratios measure a company's short-term debt paying ability and its financial...

127.Indicate whether each of the following statements about financial statement analysis is true or false.


Solvency ratios measure a company's short-term debt paying ability and its financial structure.
A company with a high debt to assets ratio probably would be considered to have a high level of financial risk.
The debt to equity ratio and debt to assets ratio are two ways to measure the same relationship.
From the point of view of stockholders, a decline in the debt to equity ratio is always good news.
The lower the debt to equity ratio, the higher a company's financial leverage.

128.Indicate whether each of the following statements about financial statement analysis is true or false.


The ratio, plant assets to long-term liabilities, is a measure of a company's ability to obtain additional long-term financing.
Generally, a company's current assets should be purchased using long-term financing such as bonds payable.
Ratios that measure a company's profitability provide some measure of the effectiveness of the company's management.
Net margin indicates the amount remaining from each sales dollar after cost of goods sold has been subtracted out.
Net margin is also sometimes called the return on assets ratio.