Klein Corporation has provided the following data: $$\begin{array} { | l | r | r | }
\hline & \text { Year 2 } & \text { Year 1 } \
\hline \text { Total assets } & \$ 1,337,000 & \$ 1,310,000 \
\hline \text { Total liabilities } & \$ 598,000 & \$ 580,000 \
\hline \begin{array} { l }
\text { Total stockholders' } \
\text { equity }
\end{array} & \$ 739,000 & \$ 730,000 \
\hline
\end{array}$$ The company's equity multiplier is closest to:
A)1.24
B)0.56
C)1.80
D)0.81

Question

Klein Corporation has provided the following data: $$\begin{array} { | l | r | r | } 
\hline & \text { Year 2 } & \text { Year 1 } \
\hline \text { Total assets } & \$ 1,337,000 & \$ 1,310,000 \
\hline \text { Total liabilities } & \$ 598,000 & \$ 580,000 \
\hline \begin{array} { l } 
\text { Total stockholders' } \
\text { equity }
\end{array} & \$ 739,000 & \$ 730,000 \
\hline
\end{array}$$ The company's equity multiplier is closest to:
A)1.24
B)0.56
C)1.80
D)0.81

Quizplus · Accepted Answer

The equity multiplier is calculated as Total Assets divided by Total Stockholders' Equity. For Year 2, it is $1,337,000 / $739,000 = 1.81, which is closest to 1.80.

Klein Corporation Has Provided the Following Data The Company's Equity Multiplier Is Closest To: A)1

Klein Corporation Has Provided the Following Data The Company's Equity Multiplier Is Closest To:
A)1