Ratio of The rights of creditors that represent debts of the business.Liabilities to The owner's right to the assets of the business.Owner's Equity

The following data were taken from Mesa Company's A list of the assets, liabilities, and owner's equity as of a specific date, usually at the close of the last day of a month or a year.balance sheet:

	Dec. 31, 2016			Dec. 31, 2015
Total liabilities	$547,800			$518,000
Total owners equity	415,000			370,000

a. Compute the ratio of liabilities to owner's equity. Round your answers to two decimal places.

	Ratio of Liabilities to Owner's Equity
Dec. 31, 2016
Dec. 31, 2015

b. Has the creditor's risk increased or decreased from December 31, 2015, to December 31, 2016?

Increased

Decreased