Chapter 14, Problem P14.35APGA

To determine

Total Liabilities:

Total liabilities can be defined as the sum or the total of short-term i.e. current liabilities and long-term i.e. long-term liabilities. The short-term and long-term liabilities are the debts or obligations which needs to be paid on a later decided date.

Long-term debt or non-current liabilities

Long-term debt can be defined as the obligations which are needed to be paid after 12 months or 1 year.

Short-term debt or current liabilities:

Short-term debt can be defined as the obligations which are needed to be paid within 12 months or 1 year.

Debt to equity:

Debt to equity can be defined as a ratio that measures a company’s financial leverage. It is calculated by dividing total liabilities to total shareholder’s equity.

Debt to equity is calculated as under –

$Debttoequity=\frac{Totalliabilities}{Totalshareholder’sequity}$

Requirement 1

To prepare:

Total liabilities section for Router Wireless including headings and totals for current liabilities and long-term liabilities

To determine

Requirement 2

To compute:

Debt to equity ratio