Determining the long-term debt

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Reference no: EM13748391

The liabilities and owners' equity for Campbell Industries is found here.

Account Payable: $523,000

Notes Payable: $252,000

Current liabilities $775,000

Long-term debt: $1,210,000

Common equity: $4,716,000

Total liabilities and equity $6,701,000

a. What fraction of the firm's assets does the firm finance using debt (liabilities)? (round to one decimal place)

b. If Campbell were to purchase a new warehouse for 1.1 million and finance it entirely with long-term debt what would be the firm's new debt ratio?

Reference no: EM13748391

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