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emmasim [6.3K]
3 years ago
7

Line Corporation's balance sheet showed the following amounts for their liability and stockholders' equity accounts: Current Lia

bilities, $5,000; Bonds Payable, $1,500; Lease Obligations, $2,000; and Deferred Income Taxes, $300. Total stockholders' equity was $6,000. The debt-to-equity ratio is
Business
1 answer:
Lelechka [254]3 years ago
7 0

Answer:

1.47

Explanation:

Debt to equity ratio = Debt / Equity

Debt to equity ratio = (Current liabilities + Bonds payable + Lease obligations + Deferred income taxes) / Total stockholder's equity

Debt to equity ratio = ($5,000 + $1,500 + $2,000 + $300) / $6,000

Debt to equity ratio = $8,800 / $6,000

Debt to equity ratio = 1.47

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