Question

John Harris, M. D., reported the following trial balance as of September 30, 2018: .: (Click the icon to view the trial balance.) i Data Table Calculate the debt ratio for John Harris, M. D. Select the debt ratio formula on the first line and then calculate the ratio. (Round the percentage to the nearest whole percent.) i L Debt ratio L Account Title Cash Accounts Receivable Office Supplies Land Building Office Equipment Accounts Payable Utilities Payable Unearned Revenue Notes Payable Common Stock Dividends Service Revenue Salaries Expense Utilities Expense Advertising Expense John Harris, M. D. Trial Balance September 30, 2018 Balance Debit Credit $ 31,000 7,700 2,600 22,000 95,000 26,000 2,600 1,000 7,765 90,000 100,000 50,000 57,535 23,000 900 700 $ 258,900 $ 258,900 Total Print Done

Answer 1

Answer :- Calculation of Debt Ratio for John Harris :-

Debt Ratio = Total Liabilities / Total Assets

Debt Ratio = $101,365 / $184,300

Debt Ratio = 55%

Working :-

Total Liabilities = Accounts Payable + Utilities Payable + Unearned Revenue + Notes Payable

Total Liabilities = $2,600 + $1,000 + $7,765 + $90,000

Total Liabilities = $101,365

Total Assets = Cash + Accounts Receivable + Office Supplies + Land + Building + Office Equipment

Total Assets = $31,000 + $7,700 + $2,600 + 22,000 + $95,000 + $26,000

Total Assets = $184,300

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