How is the debt-to-equity ratio computed?

Question

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The debt-to-equity ratio is calculated by dividing the total liabilities by the total shareholders' equity. This ratio helps in evaluating a company's financial leverage and indicates how much debt is being used to finance the company's assets compared to the equity invested by shareholders. A higher debt-to-equity ratio suggests that the company is taking on more debt to fund its operations, which can be risky if the company is not generating enough cash flow to repay its debts.

How Is the Debt-To-Equity Ratio Computed