Robert Sampson owns a $140,000 townhouse and still has an unpaid mortgage of $110,000. In addition to his mortgage, he has the following liabilities: Visa MasterCard Discover card Education loan Personal bank loan Auto loan Total $565 480 395 920 800 4,250 $7,410 Robert's net worth (not including his home) is about $21,000. This equity is in mutual funds, an automobile, a coin collection, furniture, and other personal property. What is Robert's debt-to-equity ratio? Has he reached the upper limit of debt obligations? Explain. Provide a list of liabilities to be included in calculating the ratio.
Robert Sampson owns a $140,000 townhouse and still has an unpaid mortgage of $110,000. In addition to his mortgage, he has the following liabilities: Visa MasterCard Discover card Education loan Personal bank loan Auto loan Total $565 480 395 920 800 4,250 $7,410 Robert's net worth (not including his home) is about $21,000. This equity is in mutual funds, an automobile, a coin collection, furniture, and other personal property. What is Robert's debt-to-equity ratio? Has he reached the upper limit of debt obligations? Explain. Provide a list of liabilities to be included in calculating the ratio.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:Robert Sampson owns a $140,000 townhouse and still has an unpaid mortgage of $110,000. In addition to his mortgage, he has the
following liabilities: Visa MasterCard Discover card Education loan Personal bank loan Auto loan Total $565 480 395 920 800 4,250
$7,410 Robert's net worth (not including his home) is about $21,000. This equity is in mutual funds, an automobile, a coin collection,
furniture, and other personal property. What is Robert's debt-to-equity ratio? Has he reached the upper limit of debt obligations?
Explain. Provide a list of liabilities to be included in calculating the ratio.
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