9) An automobile company decides to improve the quality of all its products and bring more variety into its product line. The co
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Answer:
Dec. 31, 2019 Ratio to Liabilities to Owner's Equity = 0.95
Dec. 31, 2018 Ratio to Liabilities to Owner's Equity = 0.80
Explanation:
given data
Dec. 31, 2019
total liabilities = $4,085,000
Total owner's equity = 4,300,000
Dec. 31, 2018
total liabilities = $2,880,000
Total owner's equity = 3,600,000
to find out
Compute the ratio of liabilities to owner's equity
solution
we know that here Ratio to Liabilities to Owner's Equity is Total Liabilities divide Total Owner's Equity ....................1
so
now put here value for both 2018 and 2019 from equation 1
so for Dec. 31, 2019
Ratio to Liabilities to Owner's Equity =
Ratio to Liabilities to Owner's Equity = 0.95
and for Dec. 31, 2018
Ratio to Liabilities to Owner's Equity =
Ratio to Liabilities to Owner's Equity = 0.80