At the end of the current year, Norman Company reported total liabilities of $300,000 and total equity of $100,000. The company's debt ratio on the last year-end was:
A) 300%.
B) 33.3%
C) 75.0%.
D) $400,000.
E) Cannot be determined from the information provideD.On the last year-end, total liabilities were $300,000 and total equity was $100,000. That means total assets were $400,000. Therefore, the debt to assets ratio was $300,000/$400,000 or 75.0%.

Question

Quizplus · Accepted Answer

We can calculate the debt ratio by dividing total liabilities by total assets. Since we do not have information on the total assets, we cannot calculate the debt ratio. However, we can use the information provided to calculate the debt to assets ratio and determine that it was 75.0% on the last year-end.

At the End of the Current Year, Norman Company Reported