Company CDE has current liabilities of $50,000 and long-term liabilities of $150,000. That company has current assets of $1,500.000 and owns plants and equipment that are worth $2,500,000. What is the debt ratio of Company CDE?

a).0.25

b). 20

c). 0.75

d). 0.05

The answer is 0.05

I am not sure if I have the right formula. However, I still do not get the correct answer. Obviously I am not plugging in the right numbers. Help!

Explanation: total debt ratio = (total assets - total equity) / total assets