Concept #1: Ratios: Debt to Equity Ratio
Practice: On its December 31 balance sheet, XYZ Company reported total assets of $880,000 and total liabilities of $560,000. What is the company’s debt to equity ratio?
Practice: At the beginning of the year, ABC Company had total assets of $600,000, Total Liabilities of $360,000, and Total Equity of $240,000. At the end of the year, total assets had increased to $800,000, Total Liabilities decreased to $320,000 and Total Equity increased to $480,000. What was the change in the company’s debt to equity ratio during the year?