A company has revenues of $700,000; invested capital of $3,000,000; total debt of $ 1,500,000 of which it pays 2.5% interest; current,long-term,and other assets totalling $4,000,000; and total expenses of $550,000.What is the company's debt ratio?

Question

Quizplus · Accepted Answer

The debt ratio is calculated as total debt divided by total assets. Here, total debt is $1,500,000 and total assets are $4,000,000. So, the debt ratio = $1,500,000 / $4,000,000 = 0.3750.

A Company Has Revenues of $700,000; Invested Capital of $3,000,000;