Debt and price-earnings ratlos The Home Depot, Inc. (HD) operates over 2,200 home improvement retail stores and is a competitor of Lowe's (Low). The following data (in millions) were adapted from recent financial statements of The Home Depot Year 2 Year 1 $39,946 $40,518 30,624 27,996 Total assets Total liabilities Total stockholders equity 9,322 12,522 Eamings per share $4.74 $3.78 1. Compute the debt ratio for Years 1 and 2. Round to one decimal place Year 2 Year 1 Debt ratio 2. Given your answer to part (1), what is the ratio of stockholders' equity to total assets? Round to one decimal place Year 2 Ratio of stockholders' equity to total assets 06 3. Compute the ratio of liabilities to stockholders' equity. Round to one decimal place. Year 2 Year 1 Ratlo of liabllities to stockholders' equity Vn 4. A high ratio of liabilities to total assets may indicate all of the following except: a. Total assets exceed liabilities. b. The company is financing its operations with a high percentage of debt. c. If operating performance declines, the company may face Increased risk that It will not be able to pay Its llablitles. d. The company's ability to borrow additional funds would be difficult for new expansion opportunities Choose the correct answer 5. Comparing Years 1 and 2, should creditors feel more or less safe in Year 2