Which of the following represents the debt ratio with liabilities considered?

The debt ratio is a financial metric that measures the proportion of a company's assets that are financed by debt. It is calculated using the formula where long-term liabilities are divided by the sum of long-term liabilities and equity. This ratio provides insight into a company's financial leverage, showing how much of the asset base is funded by debt compared to equity.

The correct choice reflects this relationship accurately. By comparing long-term liabilities to the combined total of long-term liabilities and equity, it provides a clear view of the extent of financial leverage being employed. A higher ratio indicates greater reliance on debt to finance assets, which can signal higher risk, but also potentially higher returns on equity if managed well.

Other choices do not accurately represent the debt ratio as they either include total assets improperly, lack a clear relationship between liabilities and equity, or misstate the components that define the debt ratio in the context of financial analysis. This understanding of the debt ratio is crucial for financial management, as it helps stakeholders assess the risk and structure of a company's capital financing.