Fayer Corporation has provided the following financial data:
Dividends on common stock during Year 2 totaled $4,500. The market price of common stock at the end of Year 2 was $10.88 per share.
-The company's debt-to-equity ratio at the end of Year 2 is closest to:
A) 0.22
B) 0.27
C) 0.45
D) 0.19

Question

Fayer Corporation has provided the following financial data:
   Dividends on common stock during Year 2 totaled $4,500. The market price of common stock at the end of Year 2 was $10.88 per share.
-The company's debt-to-equity ratio at the end of Year 2 is closest to:
A) 0.22 
B) 0.27 
C) 0.45 
D) 0.19

Quizplus · Accepted Answer

Debt-to-equity ratio = Total liabilities ÷ Stockholders' equity
= $481,000 ÷ $1,072,000 = 0.45 (rounded)

Fayer Corporation Has Provided the Following Financial Data