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QUESTION: Ramirez Company is considering a project that will require a $500,000 loan. It currently has total liabilities of $220,000 and total assets of $620,000. a. Compute Ramirez's present debt-to-equity ratio. b. Compute Ramirez's debt-to-equity ratio assuming it borrows $500,000 to fund the project.

QUESTION: Ramirez Company is considering a project that will require a $500,000 loan. It currently has total liabilities of $220,000 and total assets of $620,000. a. Compute Ramirez's present debt-to-equity ratio. b. Compute Ramirez's debt-to-equity ratio assuming it borrows $500,000 to fund the project.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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QUESTION: Ramirez Company is considering a project that will require a $500,000 loan. It currently has total liabilities of $220,000 and total assets of $620,000. a. Compute Ramirez's present debt-to-equity ratio. b. Compute Ramirez's debt-to-equity ratio assuming it borrows $500,000 to fund the project.
Transcribed Image Text:QUESTION: Ramirez Company is considering a project that will require a $500,000 loan. It currently has total liabilities of $220,000 and total assets of $620,000. a. Compute Ramirez's present debt-to-equity ratio. b. Compute Ramirez's debt-to-equity ratio assuming it borrows $500,000 to fund the project.
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