Mallard Decoy Manufacturing has total liabilities of $40,000 and total assets of $120,000.The owners' equity for the firm is $100,000.What is the firm's debt-to-owners' equity ratio?
A) 83 percent
B) 40 percent
C) 33 percent
D) 3 percent
E) 1.2 percent

Question

Quizplus · Accepted Answer

The debt-to-owners' equity ratio is calculated as:
Total Liabilities / Owners' Equity
= $40,000 / $100,000
= 0.4
Therefore, the debt-to-owners' equity ratio is 40 percent, which is the best answer choice.

Mallard Decoy Manufacturing Has Total Liabilities of $40,000 and Total