Sample Thesis Paper
It is also known as the total debt ratio. As its name suggests this ratio shows how much the company is in debt. For example if we take Johnson Arabia’s debt ratio figures for the year 2006 it shows 0.41 which means that for every AED in total assets Johnson Arabia has 0.41 AED of debt. This also shows the company is doing well as far as the debts to assets are concerned.
This ratio also leads us to the conclusion that the lower the debt ratio will be the higher its chances are to go up in comparison to the previous or the base year. As far as the debt ratio of Johnson Arabia is concerned it is quite evident from the graphs that it is one the declining side which in other words means good news for the business as their debts are consistently low to its assets. Throughout the five year data of Johnson Arabia which has been acquired it’s very clear that every year their debts are getting lesser as compared to their assets which is a very healthy sign form the company’s perspective.