Question

A corporation has annual sales of $20 million, total assets of $6 million, a debt ratio of 60%, depreciation expenses of $100,000, and a tax rate of 40%. The corporation's total stockholders' equity is equal to: Group of answer choices $2,800,000 $1,800,000 $2,400,000 $5,600,000

Answer 1

$2,400,000

Step-by-step explanation:

Calculation for what The corporation's total stockholders' equity is equal to

Total stockholders' equity=$6million -(.60 * $6million)

Total stockholders' equity = $6million - 3.6 million

Total stockholders' equity = $2.4million

Therefore The corporation's total stockholders' equity is equal to $2,400,000