MEGAFRAME COMPUTER COMPANY
Balance Sheet
As of December 31
ASSETS
Cash	$	50,000
Accounts receivable		70,000
Inventory		110,000
Net plant and equipment		220,000
Total assets	$	450,000
LIABILITIES AND STOCKHOLDERS EQUITY
Accounts payable	$	70,000
Accrued expenses		50,000
Long-term debt		130,000
Common stock		70,000
Paid-in capital		40,000
Retained earnings		90,000
Total liabilities and stockholders equity	$	450,000

MEGAFRAME COMPUTER COMPANY
Income Statement
For the year ended December 31
Sales (all on credit)	$	875,000
Cost of goods sold		600,000
Gross profit	$	275,000
Sales and administrative expenses		30,000
Depreciation		55,000
Operating profit	$	190,000
Interest expense		25,000
Profit before taxes	$	165,000
Taxes (30%)		49,500
Net income	$	115,500

Refer to the tables above. The firm's debt to total assets ratio is ____.

Multiple Choice

• 56.1%

• 26.7%

• 28.6%

• 55.6%