A firm has current liabilities of $60,000, stockholders' equity of $180,000 and total assets of $300,000. The percentage of total liabilities to total assets is:
A)80 percent.
B)60 percent.
C)40 percent.
D)20 percent.

Question

Quizplus · Accepted Answer

The total liabilities can be calculated by subtracting stockholders' equity from total assets: $300,000 - $180,000 = $120,000. The percentage of total liabilities to total assets is then ($120,000 / $300,000) * 100% = 40%.

A Firm Has Current Liabilities of $60,000, Stockholders' Equity of $180,000