Question
alculating the Debt-to-Equity Ratio. Thomas owns a $160,000 townhouse and still has an unpaid mortgage of $120,000. In addition to his mortgage, he has the
alculating the Debt-to-Equity Ratio. Thomas owns a $160,000 townhouse and still has an unpaid mortgage of $120,000. In addition to his mortgage, he has the following liabilities:
Visa | $600 |
MasterCard |
950 |
Discover card |
250 |
Education loan |
1000 |
Personal bank loan |
700 |
Auto loan |
3,750 |
Total | $____ |
Thomass net worth (not including his home) is $30,000. This equity is in mutual funds, an automobile, a coincollection, furniture, and other personal property. What is Roberts debt-to-equity ratio? Has he reached the upperlimit of debt obligations? Explain.
Net worth = Assets - Liabilities
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