Total liabilities divided by total stockholders' equity is the calculation for the
A) current ratio.
B) ratio of liabilities to stockholders' equity.
C) return on equity ratio.
D) times interest earned ratio.

Question

Quizplus · Accepted Answer

The ratio of liabilities to stockholders' equity is calculated by dividing total liabilities by total stockholders' equity. It shows the proportion of a company's financing that comes from debt compared to equity.

Total Liabilities Divided by Total Stockholders' Equity Is the Calculation