Question 1
The debt-to-equity ratio measures the amount of financing provided by creditors relative to
◦ equity provided by owners.
◦ equity earned from operations.
◦ equity earned through dividends.
◦ equity provided by retained earnings.
Question 2
The formula for calculating the debt-to-equity ratio is
◦ total liabilities divided by total stockholders' equity.
◦ long-term liabilities divided by stockholders' equity provided by preferred stockholders.
◦ total liabilities divided by stockholders' equity provided by preferred stockholders.
◦ long-term liabilities divided by total stockholders' equity.