Chapter 8, Problem 8.11MBA

To determine

Concept Introduction:

Debt Ratio:

Debt ratio is the relationship between the Total liabilities and Total Assets of a corporation. Debt ratio shows the part of assets financed by debts. It is calculated by dividing total liabilities by total assets. The formula of debt ratio is as follows:

  $\text{Debt Ratio = }\frac{\text{Total Liabilities}}{\text{Total Assets}}$

Price Earnings Ratio:

The price earnings ratio shows the relationship between price of the share and earnings per share. It is calculated with the help of following formula:

  $\text{Price Earnings Ratio=}\frac{\text{Market price per share}}{\text{Earnings per share}}$

To Indicate:

The Debt ratio and Price earnings ratio for each of the given Company