Answered

Looking for answers? Westonci.ca is your go-to Q&A platform, offering quick, trustworthy responses from a community of experts. Join our Q&A platform to connect with experts dedicated to providing precise answers to your questions in different areas. Our platform provides a seamless experience for finding reliable answers from a network of experienced professionals.

Refer to the balance sheet above. If in 2006 Luther has 10.2 million shares outstanding and these shares are trading at $16 per share, then using the market value of equity, the debt-equity ratio for Luther in 2006 is closest to

Sagot :

Zviko

Answer:

176 %

Explanation:

Note : The full question is attached below

The debt-equity ratio is part of the Debt Management Ratios. It shows how much foreign money is used by the company.

Debt-equity ratio = Total Debt / Total Equity × 100

Where

Total Debt = Short term debt + Current maturities of long term debt + Long term debt

                 = 9.3 million + 38.8  million + 239.1  million

                 = $287,200,000

Total Equity = Shares outstanding × Market Value

                    =  10,200,000 × $16

                    = $163,200,000

Therefore,

Debt-equity ratio = 176 %

The debt-equity ratio for Luther in 2006 is closest to 176 %

We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. We're glad you chose Westonci.ca. Revisit us for updated answers from our knowledgeable team.