Ask Experts Questions for FREE Help !
    XMXH136's Avatar
    XMXH136 Posts: 2, Reputation: 1
    New Member

    Aug 21, 2012, 03:56 PM
    the liabilities and owner
    The liabilities and owners equity for Campbell Industries:
    Accounts payable $492,000
    Notes payable $242,000
    Current liabilities=734,000
    Long-term debt $1,295,000
    Common equity $5,252,000
    Total liabilities and equity=7,281,000
    (a) What percentage of the firm's assets does the firm fonance using debt (liabilities0
    (b) If Campbell were to purchase a new warehouse for 1.5 million and finance it entirely with long-term debt, what would be the firm's new debt ratio?

    a. What percentage of the firm's assets does the firm finance using debt (liabilities)

    The fraction of the firm's assets that the firm finances using debt is %. (Round to one decimal place).
    I have tried and I keep reading the material over and still not able to find the correct solution. I just need the steps in order for me to solve the problem! Please help.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
    Ultra Member

    Aug 27, 2012, 02:27 PM
    First you need to know 2 things.

    1. Total Assets = Total Liabilities + Owners Equity

    2. Debt Ratio = Total Liabilities / Total Assets

    Since Total Assets equals Total Liabilities plus Owners Equity you already know this amount. Total Assets is $7,281,000

    Now to answer question (a) the first thing you need to do is find total liabilities. So Total Liabilites = Current Liabilities + Long-Term Liabilities. Now you have Total liabilites so divide this number by total assets and multiply it by 100 to get your answer to a percentage amount.

    For question (b) you will have to add $1,500,000 to total assets to get your new total assets amount and you will have to add $1,500,000 to your total liabilities amount to get your new total liabilities amount. Now take your new total liabilities amount and divide it by your new total assets amount and times it by 100 to get your answer to a percentage amount.
    cbanger's Avatar
    cbanger Posts: 2, Reputation: 1
    New Member

    May 28, 2013, 12:38 PM
    To what amount will $5,000 invested for 8 years at 9% compounded annually accumulate?

Not your question? Ask your question View similar questions


Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.

Check out some similar questions!

If two people own a home can one owner charge the other owner rent [ 1 Answers ]

If two people qwn one home can the other owner charge rent

Owner and Contact Information for Property Owner [ 2 Answers ]

I need to know who and how to reach the owners of property located at {address removed}. Thanks,

Co-owner trying to force other co-owner into foreclosure [ 2 Answers ]

I am a co-owner of a house with my ex boyfriend in Arizona. He moved out without notice. He has an apartment and told me that he was just going to let the house foreclose. I cannot afford the mortgage on my own. I said I would just get roommates (which would be my mother) He told me no he wouldn't...

View more questions Search