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6 March, 04:03

Durable Plastics Company had the following total assets, liabilities, and equity as of December 31. Total Assets$ 450 comma 000Total Liabilities131 comma 000Total Equity319 comma 000What is the company's debt ratio as of December 31? (Round your percentage answer to two decimal places.)

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  1. 6 March, 04:34
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    Answer: Debt ratio = 29.11%

    Explanation:

    A company's Debt ratio explains the financial leverage of a company to paying off its liabilities using its assets by measuring a company's total liabilities as a percentage of its total assets.

    Given,

    Total Assets $ 450,000

    Total Liabilities $131, 000

    Total Equity $319,000

    Debt ratio = Total Liabilites / total asset x 100

    =131000/450000 X 100

    = 29.11%
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