Question

Mike and Mary Jane Lee have a yearly income of ​$ and own a house worth ​$​, two cars worth a total of and furniture worth ​$. The house has a mortgage of ​$ and the cars have outstanding loans of ​$ each. Utility​ bills, totaling ​$ for this​ month, have not been paid. Calculate the debt ratio for the Lee household.

Answer 1

48.11%

Step-by-step explanation:

Calculation for the debt ratio for the Lee household.

First step is to know the Total assets

ASSETS:

House Worth 79,352

Two Cars Worth 19,907

Furniture Worth 10,442

Total Assets =$132,449

Second step is to know the Liabilities

LIABILITIES:

Mortgage Due 58,347

Car Loan Balance 5134

(2,567 each×2)

Utility Bills 242

Total liabilities =63,723

Now let calculate for the Debt debt ratio for the Lee household using this formula

Debt debt ratio=Total liabilities/Total Assets

Let plug in the formula

Debt debt ratio=63,723 /132,449

Debt debt ratio = 0.4811×100

Debt debt ratio = 48.11%

Therefore for Debt debt ratio for the Lee household will be 48.11%