What happened? That Happened

This happened:

Our teacher asked if a 50% debt-to-equity ratio is good for an entity. And as my knowledge is concerned, I answered a resounding YES, with so much confidence.

and of course, as usual, after the yes, an echoing "why?" question would be brought out. Which I answered, "Yes because the capital is more utilized than the liabilities in acquiring or getting hold of the entity's assets."

In which some people in the class disapproved! at nagsasapawan na sila sa kanilang explanations.

They said that my reason is not valid because the 50% debt-to-equity ratio means that half of the assets are provided by creditors. So tabla-tabla lang daw ang utilization of debt and equity on the assets.

Okay, okay, don't be so confident about your answers just because I didn't raise any argument that your reason is NOT, in any principles of accounting, VALID. Yes, your argument is void ab initio. 

debt-to-equity ratio measures the amount of assets being PROVIDED BY CREDITORS (so, these are your liabilities) for each peso of assets being PROVIDED BY THE STOCKHOLDERS (and these is the entity's capital).

So, this ratio shows relationship between the liabilities and the equity of the entity. LIABILITIES AND EQUITY muna, hindi muna assets. 

Let's try situations to make a 50% result on the debt-to-equity ratio. let us assume  that the capital has an amount of 100,000, so to get a 50% ratio, your liabilities must be 50,000.

So technically, your assets consists of an amount of 100,000 provided by the stockholders and 50,000 provided by creditors. Okay, sabihin mo ngayon sa akin if the assets consists of 50% of liabilities, huh! Because if we apply your argument, 

"50% ratio on debt-to-equity means a half interest of liability on your assets,"

eh di dapat your liabilities must have an amount of 75,000 pesosesoses!! Not 50,000. And computing such, you must have an equal debt and equity to arrive at your argument! and that's 100% or 1 is to 1, not 50%.

Miscommunications occur, but my reason is very clear. Analyze everything before seconding opinions okay?