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A firm has total debt of $1,480 and a debt–equity ratio of .33. What is the value of the total assets?
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A firm has total debt of $1,480 and a debt–equity ratio of .33. What is the value of the total assets?

User Ryan John
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1 Answer

5 votes

Answer:

The Value of the Total assets is $5964.85

Step-by-step explanation:

The formulae for deriving Debt-equity ratio = debt / equity

Then, Equity = Debt / Debt-equity ratio

Hence Equity= (1480 / 0.33) = $4484.85

Whereas, Total assets = Total liabilities (Debt) + Total equity

Value of the Total assets = 1,480 + 4,484.85

Value of the Total assets = $5964.85

User ShanjayG
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