Assume the following data: Long-term debt = 100; Value of leases = 20; Book value of equity = 80.Calculate the debt-equity ratio.
A)0.50
B)0.60
C)1
D)1.50

Name: Assume the following data: Long-term debt = 100; Value of leases = 20; Book value of equity = 80.Calculate the debt-equity ratio. A)0.50 B)0.60 C)1 D)1.50
Brand: Quizplus
Rating: 4.9 (40 reviews)

Question

Quizplus · Accepted Answer

The debt-equity ratio is calculated as (Long-term debt + Value of leases) / Book value of equity = (100 + 20) / 80 = 1.50.

Assume the Following Data: Long-Term Debt = 100; Value of Leases