The liabilities of a company at the end of the year are $500,000 and the total stockholders' equity at the end of the year is $1,000,000.The debt to stockholders' equity ratio is:
A)0)50 to 1.
B)0)33 to 1.
C)0)67 to 1.
D)3)00 to 1.

Question

Quizplus · Accepted Answer

The debt to stockholders' equity ratio is calculated by dividing total liabilities by total stockholders' equity. Here, $500,000 / $1,000,000 = 0.50 to 1.

The Liabilities of a Company at the End of the Year