Question

Charger Company's most recent balance sheet reports total assets of $32,868,000, total liabilities of $19,668,000 and total equity of $13,200,000. The debt to equity ratio for the period is (rounded to two decimals):

Answer 1

Answer:

1.49

Explanation:

The computation of the debt equity ratio is shown below:

Debt Equity Ratio is

= Total liabilities ÷ total equity

= $19,668,000 ÷ $13,200,000

= 1.49

By dividing the total liabilities from the total equity we can get the debt equity ratio and the same is to be considered plus it also shows a relationship between the total liabilities and total equity