Calculate the Debt Ratio from the Following Information

question 84

Multiple Choice

Calculate the debt ratio from the following information. Land and building = $500,000
Machinery = $300,000
Cash in hand = $400,000
Total debts = $300,000

• A) 3:4
• B) 1:4
• C) 2:3
• D) 2:2
• E) 1:3

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Definitions:

Monetary

Relating to money or currency, typically involving the management, transfer, or creation of money.

Interest Rate

The amount charged by a lender to a borrower for the use of assets expressed as a percentage of the principal, influencing investment, spending, and economic growth.

Deposited

Refers to placing money into a financial account or institution for safekeeping or as an investment.

Interest

The charge for borrowing money, usually expressed as a percentage of the amount borrowed over a specified period.