Peartree Company Provides the Following Data What Is Peartree's Debt Ratio at Year-End 2017?
A) 0

question 113

Multiple Choice

Peartree Company provides the following data:
$\begin{array}{|l|r|r|}\hline \text { BALANCE SHEET } & 31 \text { Dec } 2017 & 31 \text { Dec } 2016 \\\hline \text { Cash } & \$ 21000 & \$ 18000 \\\hline \text { Accounts receivable, net } & 31000 & 35000 \\\hline \text { Inventory } & 53000 & 25000 \\\hline \text { PP\&E, net } & 120000 & 90000 \\\hline \text { Total assets } & \$ 225000 & \$ 168000\\\hline \\\hline \text { Accounts payable } & \$ 4000 & \$ 6000 \\\hline \text { Accrued liabilities } & 2000 & 1000 \\\hline \text { Long-term loans payable } & 84000 & 90000 \\\hline \text { Total liabilities } & \$ 90000 & \$ 97000 \\\hline\\\text { Share capital } & \$ 30000 & \$ 2000 \\\hline \text { Retained earnings } & 105000 & 69000 \\\hline \text { Total shareholders' equity } & \$ 135000 & \$ 71000 \\\hline \text { Total liabilities and } & & \\\text { shareholder's'equity } & \$ 225000 & \$ 168000\\\hline\end{array}$
What is Peartree's debt ratio at year-end 2017?

• A) 0.67
• B) 4.67
• C) 0.40
• D) 1.00

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