Problem:
Arrow's Archery Training Center reported $1,400M in Total Assets; $700M in Current Assets; $145 in Current Liabilities; and $720M in Total Liabilities. What is the company's debt ratio (total liabilities ÷ total assets)? The industry average is .40. How should the company respond? Question Select one: A. The company's debt ratio equals .51. The company should take no corrective action. B. The company's debt ratio equals .15. The company should increase its total liabilities C. The company's debt ratio equals .51. The company should decrease its total liabilities. D. The company's debt ratio equals .15. The company should take no corrective action. E. The company's debt ratio equals .15. The company should increase its total assets.