The following data (in millions) is given for Magenta Inc.for the current year. $$\begin{array} { l l }
\text { Total assets } & \$ 720,000 \
\text { Total liabilities } & \$ 411,000 \
\text { Total stockhol ders' equity } & \$ 309,000
\end{array}$$ ? Compute the debt ratio.(Round to the nearest whole number.)

Question

The following data (in millions) is given for Magenta Inc.for the current year. $$\begin{array} { l l } 
\text { Total assets } & \$ 720,000 \
\text { Total liabilities } & \$ 411,000 \
\text { Total stockhol ders' equity } & \$ 309,000
\end{array}$$ ? Compute the debt ratio.(Round to the nearest whole number.)

Quizplus · Accepted Answer

The debt ratio is calculated as Total Liabilities divided by Total Assets. Here, it is \$411,000 / \$720,000 = 0.571 or 57% when rounded to the nearest whole number.

The Following Data (In Millions) Is Given for Magenta Inc