Identify the Correct Formula Below Used to Calculate the Debt

question 102

Multiple Choice

Identify the correct formula below used to calculate the debt ratio.

• A)Total Equity/Total Liabilities.
• B)Total Liabilities/Total Equity.
• C)Total Liabilities/Total Assets.
• D)Total Assets/Total Liabilities.
• E)Total Equity/Total Assets.

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Definitions:

Tippee

A person who receives inside information.

Material Fact

A fact that, if known, would influence a person's decision-making related to a contract, transaction, or legal case.

Insider Trading

The unlawful act of conducting trades on the stock market for personal gain by exploiting privileged, non-public information.

Securities Exchange Act

A federal law governing the trading of securities, such as stocks and bonds, aimed at protecting investors and maintaining fair and orderly markets.