Asked by Kaylee Rabon on Jun 05, 2024
Verified
The debt-to-equity ratio is calculated by dividing stockholders' equity attributable to common shareholders by total liabilities.
Stockholders' Equity
The residual interest in the assets of a company that remains after deducting its liabilities, representing ownership interest.
Total Liabilities
The sum of all financial obligations (debts) owed by a company to external entities or individuals.
- Determining and understanding the debt-to-equity ratio's implications for evaluating corporate financial risk.
Verified Answer
CS
CAITLYN STANKOVICJun 05, 2024
Final Answer :
False
Explanation :
The debt-to-equity ratio is calculated by dividing total liabilities by stockholders' equity attributable to common shareholders.
Learning Objectives
- Determining and understanding the debt-to-equity ratio's implications for evaluating corporate financial risk.
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