• The ratio equation
• The calculation of the ratio using the equation and the pre-assigned Quick Study or Exercise from the textbook.
• Use the result in a sentence; i.e. For every dollar invested in assets the company is earning 22.4 cents or 22.4% in net income.
• Then explain whether this is a good result or a result that needs improving.

QS 2-15 Computing and using the debt ratio Q A2 O In a recent year's financial statements, Home Depot reported the following: Total liabilities = $38,633 million and Total assets = $42,966 million. Compute and interpret Home Depot's debt ratio (assume competitors average a 60.0% debt ratio)