A corporation reports the following year-end balance sheet data.

-The company's debt ratio equals:
A)0.58
B)1.27
C)2.07
D)0.37
E)0.63

Name: A corporation reports the following year-end balance sheet data. -The company's debt ratio equals: A)0.58 B)1.27 C)2.07 D)0.37 E)0.63
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Question

A corporation reports the following year-end balance sheet data.

-The company's debt ratio equals: 
A)0.58 
B)1.27 
C)2.07 
D)0.37 
E)0.63

Quizplus · Accepted Answer

Debt Ratio = Total Debt / Total Assets
Total Debt = Long-Term Debt + Current Liabilities
Total Debt = $95 + $65 = $160 million
Total Assets = $435 million
Debt Ratio = $160 million / $435 million = 0.37

A Corporation Reports the Following Year-End Balance Sheet Data