Balance SheetCurrent assetsCash 1,010,000Acc receivable not givenInventories 1,150,000Fixed assets 4,100,000TOTAL ASSETS 7,200,000Current liabilitiesAcc payable not givenLong-term2,900,000Common stock 1,010,000Retained earnings 2,830,000TOTAL LIAB and EQUITY 7,200,000Income StatementSales 21,600,000Operating expense 18,140,000EBIT 3,460,000Interest expense 348,000ЕBТ 3, 112, 000Taxes 1,245, 000Net income 1,867,000What is the firm's debt ratio?O 93.61%40.28%53.33%O 46.67%O 85.97%

Debt ratio: It is a type of financial ratio, where the amount of debts used by the company in…

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What is the firm's debt ratio? O 93.61% O 40.28% O 53.33% 46.67% 85.97%

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

Balance Sheet
Current assets
Cash 1,010,000
Acc receivable not given
Inventories 1,150,000
Fixed assets 4,100,000
TOTAL ASSETS 7,200,000
Current liabilities
Acc payable not given
Long-term
2,900,000
Common stock 1,010,000
Retained earnings 2,830,000
TOTAL LIAB and EQUITY 7,200,000
Income Statement
Sales 21,600,000
Operating expense 18,140,000
EBIT 3,460,000
Interest expense 348,000
ЕBТ 3, 112, 000
Taxes 1,245, 000
Net income 1,867,000
What is the firm's debt ratio?
O 93.61%
40.28%
53.33%
O 46.67%
O 85.97%

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