Question

10. Creditors of the business want to know:
(A) Profitability of the Business
(B) Capability of the business to pay higher salaries
(C) Creditworthiness of the business
(D) Employment Opportunities​

Answer 1

Explanation:

credit worthiness of the business. A debt to equity ratio of 2:1 is considered healthy

Answer 2

Creditors of the business want to know (C) the creditworthiness of the business.

Creditworthiness:

• Creditworthiness is a creditor's or bank's evaluation of an individual's or company’s liquidity in its loans on time.
• This evaluation includes the individual's or business's future expected financial position.
• Creditworthiness is determined based on the credit implementation, credit references, as well as financial statements provided to the party's decision to grant credit, and also a credit report provided by a third-party credit reporting agency.
• One may indeed depend on the organisation under review's previous payment history, and also one's assessment of the character of the person authorising payments.
• Some organisations use credit scoring models to transform this information into a score that is being used as the main basis for determining creditworthiness.