Exercise 10-16 (Algo) Applying debt-to-equity ratio LO A2 Montclair Company is considering a project that will require a $690,000 loan. It presently has total liabilities of $125,000 and total assets of $715,000. 1. Compute Montclair's (a) current debt-to-equity ratio and (b) the debt-to-equity ratio assuming it borrows $690,000 to fund the project. 2. If Montclair borrows the funds, does its financing structure become more or less risky? Choose Numerator: 1 Choose Denominator: / Debt-to-Equity Ratio 0 1. (a) 1.(b) / 0 2. If Montclair borrows the funds, does its financing structure become more or less risky