a person has total assets = 384 860 and total liabilities = 122 110. the mortgage is worth 29 898. calculate the debt to equity ratio.
a 35.09
b 31.73
c 284.84
d 46.47
To calculate the debt to equity ratio, you need to divide the total liabilities by the owner's equity. The owner's equity can be obtained by subtracting the total liabilities from the total assets.
Total assets = 384,860
Total liabilities = 122,110
Owner's equity = Total assets - Total liabilities
Owner's equity = 384,860 - 122,110
Owner's equity = 262,750
Now, you can calculate the debt to equity ratio by dividing the total liabilities by the owner's equity.
Debt to equity ratio = Total liabilities / Owner's equity
Debt to equity ratio = 122,110 / 262,750
Calculating the debt to equity ratio: 122,110 / 262,750 = 0.4647
The debt to equity ratio is 0.4647.
Since none of the answer choices matches this decimal value exactly, it seems that there might be a rounding error in the given answer options. However, if we multiply the ratio by 100, it would be approximately 46.47.
So, the correct answer would be d) 46.47.