The ratio equationThe calculation of the ratio using the equation and the pre-assigned Quick Study or Exercise from the textbook. Use the result in a sentence; i.e. For every dollar invested in assets the company is earning 22.4 cents or 22.4% in net income. Then explain whether this is a good result or a result that needs improving. QS 2-15 Computing and using the debt ratio LA2 OIn a recent year's financial statements, Home Depot reported the following: Total liabilities = $38,633million and Total assets = $42,966 million. Compute and interpret Home Depot's debt ratio (assumecompetitors average a 60.0% debt ratio).

Debt ratio shows that liabilities consist of how much percentage of total assets in the business.

QS 2-15 Computing and using the debt ratio L A2 O In a recent year's financial statements, Home Depot reported the following: Total liabilities = $38,633 million and Total assets = $42,966 million. Compute and interpret Home Depot's debt ratio (assume competitors average a 60.0% debt ratio).

QS 2-15 Computing and using the debt ratio L A2 O In a recent year's financial statements, Home Depot reported the following: Total liabilities = $38,633 million and Total assets = $42,966 million. Compute and interpret Home Depot's debt ratio (assume competitors average a 60.0% debt ratio).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The ratio equation
The calculation of the ratio using the equation and the pre-assigned Quick Study or Exercise from the textbook.
Use the result in a sentence; i.e. For every dollar invested in assets the company is earning 22.4 cents or 22.4% in net income.
Then explain whether this is a good result or a result that needs improving.

QS 2-15 Computing and using the debt ratio LA2 O
In a recent year's financial statements, Home Depot reported the following: Total liabilities = $38,633
million and Total assets = $42,966 million. Compute and interpret Home Depot's debt ratio (assume
competitors average a 60.0% debt ratio).

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