If Caesar's Coffee Company had total liabilities of $200,000 and total Stockholders' Equity of $150,000, then the debt ratio would be 57%.

Question

Quizplus · Accepted Answer

Debt ratio is calculated by dividing the total liabilities by the total assets of a company. However, the question only provides information about total liabilities and total stockholders' equity. Therefore, we need to calculate the total assets first:

Total Assets = Total Liabilities + Stockholders' Equity 
Total Assets = $200,000 + $150,000 
Total Assets = $350,000

Now we can calculate the debt ratio:

Debt Ratio = Total Liabilities / Total Assets 
Debt Ratio = $200,000 / $350,000 
Debt Ratio = 0.57 or 57%

Therefore, the answer is A (True).

If Caesar's Coffee Company Had Total Liabilities of $200,000 and Total