Goodyear Tire and Rubber Company Data Analysis Chapter

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61 billion / $1.3 million. In this aspect, CTB is a stronger company in comparison with Goodyear, as they are more effectively using their assets to increase sales. ("Cooper Tire and Rubber Annual Report," 2010)

The Debt Ratio

The debt ratio is used by investors to determine the overall risks to the business from: various loans and other financial obligations they have. During times of financial challenges, the total amounts of debt could have an impact on future company's revenues (which may affect the financial strength of the business itself). This ratio is calculated by dividing the total debt into the total amount of assets. Any kind of reading higher than 1.0 indicates that the company has more than enough assets to meets its financial obligations. ("Debt Ratio," 2011) In the case of GT, the company has a debt ratio of .28. This was determined by dividing $4.

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475 billion into $15.63 billion. While CTB, has a debt ratio of .90. This was calculated by dividing $21 billion into $23 billion. In this aspect, CTB has lower amounts of debt in comparison with Goodyear. ("Goodyear Tire and Rubber Annual Report," 2010) ("Cooper Tire and Rubber Annual Report," 2010)

The Debt to Equity Ratio

The debt to equity ratio is designed to tell investors how much debt and equity a company is using to finance its expansion. The higher the number is, the greater the chances that an organization has been using its debt to finance their growth. This number is calculated by dividing the total liabilities into the shareholder equity. ("Debt to Equity Ratio," 2011) As far as GT is concerned, the company has a debt to equity ratio of 50.99. This was.....

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