Dynasty Industries reported total liabilities of ¥9,000,000 and total assets of ¥12,000,000. The current exchange rate is ¥120 = $1. What is Dynasty Industries' debt ratio?
A)¥0.75
B)133%
C)75%
D)6)25%

Question

Quizplus · Accepted Answer

Debt ratio = total liabilities / total assets

Using the current exchange rate:
total liabilities = ¥9,000,000 / ¥120 = $75,000
total assets = ¥12,000,000 / ¥120 = $100,000

Debt ratio = $75,000 / $100,000 = 0.75 or 75%

Dynasty Industries Reported Total Liabilities of ¥9,000,000 and Total Assets