Which financial ratio measures the extent to which borrowed funds have been used to finance the company's assets?
A) debt to asset ratio
B) debt to equity ratio
C) long-term debt to capital structure
D) times interest earned
E) current liabilities to equity

Question

Quizplus · Accepted Answer

The debt to asset ratio measures the amount of a company's assets that have been financed through debt, giving an indication of the company's leverage. It is calculated by dividing total liabilities (including both short and long-term debt) by total assets.

Which Financial Ratio Measures the Extent to Which Borrowed Funds