2012 Fall Q21(c)

Kh92

Hello,

I was quite confused by the question using the word of 'total liabilities', which makes me think of 20.20 Total Gross Liabilities at first. (derived by adding reins recoverables to equity). However, the solution is actually referring to the net basis of Total Liabilities. Should we always consider the term 'Total Liabilities' on net basis unless told otherwise?

Thanks,

graham

Take a look at this post and my answer. If it doesn't answer your question, please let me know and we can discuss further.

• https://battleactsmain.ca/vanillaforum/discussion/43/overall-net-leverage-ratio