Granger Ltd. reported the following information on their most recent statement of financial position: $$\begin{array} { l r }
\text { Current assets } & \$ 200,000 \
\text { Total assets } & 797,000 \
\text { Current liabilities } & 160,000 \
\text { Total equity } & 350,000
\end{array}$$ To the nearest percent, what is Granger's debt to total assets?

Question

Granger Ltd. reported the following information on their most recent statement of financial position: $$\begin{array} { l r } 
\text { Current assets } & \$ 200,000 \
\text { Total assets } & 797,000 \
\text { Current liabilities } & 160,000 \
\text { Total equity } & 350,000
\end{array}$$ To the nearest percent, what is Granger's debt to total assets?

Quizplus · Accepted Answer

To calculate the debt to total assets ratio, we need to divide the total liabilities by the total assets. In this case, the total liabilities are $450,000 and the total assets are $800,000.

Debt to Total Assets = Total Liabilities / Total Assets 
Debt to Total Assets = $450,000 / $800,000

Debt to Total Assets = 0.5625

Rounding to the nearest percent, we get 56%, which is answer choice C.

Granger Ltd To the Nearest Percent, What Is Granger's Debt to Total