Reference no: EM132984651

Use the following taken from Blix Company's December 31 year-end Financial Statements:

Preferred Dividends$50,000

Net Income $350,000

Cash Dividends to common stockholders $100,000

January 1 Common Stockholders' Equity $3,000,000

December 31 Common Stockholders' Equity $4,000,000

Preferred Shares Outstanding 80,000

Common Shares Outstanding 150,000

Total Liabilities $4,200,000

Total Assets $10,000,000

Interest Expense $20,000

Income before taxes and interest $560,000

Problem 1: What is the Debt to Assets ratio?

Select one:

a. 0.800

b. 0.005

c. 2.381

d. 0.400

e. 0.420