Woods Weatherproofing,Inc.has current assets of $43,600,long-term assets of $252,900,current liabilities of $41,400,and long-term debt of $129,800.Woods Weatherproofing,Inc.'s debt ratio is:

Question

Quizplus · Accepted Answer

Debt ratio is calculated as (total liabilities)/(total assets).

Total liabilities = current liabilities + long-term debt = $41,400 + $129,800 = $171,200
Total assets = current assets + long-term assets = $43,600 + $252,900 = $296,500

Debt ratio = $171,200/$296,500 = 0.577 or 57.7%

Therefore, the correct choice is B, and Woods Weatherproofing,Inc.'s debt ratio is 57.7%.