Jordan Manufacturing Reports the Following Capital Structure What Is the Debt Ratio?
A)0

Jordan Manufacturing reports the following capital structure:
$\begin{array}{llcc} \text { Current liabilities } & \$100,000 \\ \text { Long-term debt } &400,000\\ \text {Deferred income taxes } &10,000\\ \text { Preferred stock } &80,000\\ \text {Common stock } &100,000\\ \text { Premium on common stock } &180,000\\ \text { Retained earnings } &170,000\\\end{array}$

What is the debt ratio?

A) 0.48
B) 0.49
C) 0.93
D) 0.96
E) None of the answers are correct.

Correct Answer:

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