Question

The 2012 financial statements of Marker Co. contain the following selected data (in millions).

Current Assets $ 75

Total Assets 140

Current Liabilities 40

Total Liabilities 95

Cash 8

The debt to total assets ratio is:

a.67.9%.

b.96.4%.

c.28.6%.

d.256%

Answer 1

a.67.9%.

Step-by-step explanation:

Debt to Total Assets Ratio = Total Liabilities / Total Assets x 100

Total Liabilities = $95,000,000

Total Assets = $140,000,000

Debt to Total Assets Ratio = $95,000,000 / $140,000,000 x 100

Debt to Total Assets Ratio = 0.679 x 100

or

Debt to Total Assets Ratio = 67.9%

Hence, The Assets of Marker Co. are 67.9% funded by creditors.