5 Clayton Industries has the following account balances Current asset Noncurrent assets $ 25,000 Current 1labilities 87,000 Noncurrent liabilities Stockholders' equity $13,000 46,000 53,000 The company wishes to raise $42,000 in cash and is considering two financing options: Clayton can sell $42,000 of bonds payable, or it can issue additional common stock for $42,000. To help in the decision process, Clayton's management wants to determine the effects of each alternative on its current ratio and debt-to-assets ratio. Required 2-1. Compute the current ratio for Clayton's management. (Round your answers to 2 decimal places.) Currently if bands are issued of stock is issued Current Ratio to 1 to 1 101 a-2. Compute the debt-to-assets ratio for Clayton's management. (Round your answers to 1 decimal place.) Debt to Assets Ratio Currently # bonds are issued Wf stock is issued % b. Assume that after the funds are invested, EBIT amounts to $15.700. Also assume the company pays $3,800 in dividends or $3,800 in interest depending on which source of financing is used. Based on a 30 percent tax rate, determine the amount of the increase in retained earnings that would result under each financing option Additional Retained Earnings Bonds Stock