Answer:
The debt to equity ratio is 1.25
Explanation:
The computation of the debt to equity ratio is shown below:
Debt to equity ratio = Debt ÷ equity
Given that
Last year debt to equity ratio = 1.40
And, this year the debt to equity ratio = 1.25
Based on the above information, the debt to equity ratio is 1.25
As we can assume that the question ask for the current year so the debt to equity ratio is 1.25
It also shows the relationship between the debt and equity
