Clayton Industries has the following account balances: The company wishes to raise $40,000 in cash and is considering two financing options: Clayton can sell $40.000 of bonds payable, of it can issue additional common stock for $40,000. 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 ratlo. Required a-1. Compute the current ratio for Clayton's management. Note: Round your answers to 2 decimal ploces. a-2. Compute the debt-to-assets ratio for Clayton's management. Note: Round your answers to 1 decimal place. Answer is not complete. b. Assume that after the funds are invested, EBIT amounts to $19,800. Also assume the company pays $3,300 in dividends or $3,300 in interest depending on which source of financing is used. Based on a 40 percent tax rate, determine the amount of the increase in retained earnings that would result under each financing option