Question

In: Finance

What is the financial risk of the General Mills (the debt to total capitalization ratio)?

What is the financial risk of the General Mills (the debt to total capitalization ratio)?

Solutions

Expert Solution

Financial risk of General Mills = Total Long Term debt/( Equity + Long term Debt)

As per data from YAHOO finance Total Long Term debt =12,688,700

Total equity = 6,141,100
Financial risk =12,688,700/(12,688,700+6,141,100)=0.67


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