On December 31, 2009, Barton Incorporated Had Total Liabilities of $60,000

question 35

Essay

On December 31, 2009, Barton Incorporated had total liabilities of $60,000 and total shareholders' equity of $90,000, resulting in a debt/equity ratio of 0.67 before income tax expense is recognized. On December 31, 2009, Barton paid its 2009 income taxes of $6,000 while its income tax expense on its 2009 income statement was $8,000. This difference exists because Barton uses straight-line depreciation on its books and double-declining-balance depreciation on its tax returns. What is Barton's debt/equity ratio after the tax expense and deferred tax liability are recognized?

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Definitions:

Audience Benefit

The advantage or positive outcome that the audience gains from engaging with a particular piece of content, presentation, or product.

Key Solution

The most effective or pivotal answer to a problem, often being central to resolving a complex issue or challenge.

Formal Work Culture

An organizational environment that emphasizes professionalism, hierarchy, rules, and structured communication.

Individual Offices

Separate room or spaces designated for one person to work in, often offering privacy and individual work environment.