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What is the debt-to-equity ratio

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Reference no: EM132830062

Problem - This is an excerpt from Blue Design's 2017 annual report:

Millions

2017

2016

Debit

$50,000

$48,000

Equity

$34,000

$32,000

Required -

Part A - What is the debt-to-equity ratio for 2017 and 2016 based on end of year values for debt and equity?

Part B - The Company had operating leases which totaled $3,200 and $4,000 in 2017 and 2016 (respectively). Assume the leasers were capitalized (included in the total amount of debt reported). What is the recalculated debt-to-equity ratio for 2017 and 2016 without the operating leases? What does capitalizing the leases do to risk perception or Blue Design?

Reference no: EM132830062

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