Using the data in M5-12, compute the debt-to-assets ratio for the current and prior years. What do these analyses indicate?
Data From M5-12
Prior Year Current Year
Income from Operations................... $ 1,700..................... $1,400
Net Income....................................... 850........................ 700
Total Assets.................................... 10,000..................... 9,000
Total Stockholders' Equity................... 8,000..................... 7,500
Total Revenue.................................. 9,000...................... 7,000