Answer:
The company's debt to assets ratio is 0.35 (35%)
Explanation:
The debt to total assets ratio is an indicator of a company's financial leverage. It is calculated by total amount of a company's liabilities divided by the total amount of the company's assets with the following fomula:
Debt to assets ratio = Total Debt/ Total assets
Total Debt = Current liabilities + Long-term liabilities = $40,000+$100,000 = $140,000
Total Assests = Current assets + Long-term assets = $50,000+$350,000 = $400,000
Debt to assets ratio = $140,000/$400,000 = 0.35 (35%)
