The debt-to-equity ratio at the end of Year 2 is closest to:

A) 0.38
B) 0.13
C) 0.16
D) 0.43

Question

The debt-to-equity ratio at the end of Year 2 is closest to:A) 0.38B) 0.13C) 0.16D) 0.43

Holly Macknight · Accepted Answer

Final Answer : A, Explanation :  Debt-to-equity ratio = Total liabilities ÷ Stockholders' equity = $400 ÷ $1,040 = 0.38 (rounded)Reference: CH14-Ref20Neef Corporation has provided the following financial data from its balance sheet and income statement:

The debt-to-equity ratio at the end of Year 2 is closest to:

A) 0.38
B) 0.13
C) 0.16
D) 0.43

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