Exercise 10-25A (Algo) Determining the effects of financing alternatives on ratios LO 108 Clayton Industries has the following account balances: The company wishes to raise $36,000 in cash and is considering two financing options: Clayton can sell $36,000 of bonds payable, or it can issue additional common stock for $36,000. 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 0-1. Compute the current ratio for Clayton's management. Note: Round your answers to 2 decimal places. 0.2. Compute the debteto-assets fatio for Clayton's management Note: Round your answers to 1 decimal ploce. a-2. Compute the debt-to-assets ratio for Clayton's management. Note: Round your answers to 1 decimal place. b. Assume that after the funds are invested, EBIT amounts to $15,100. Also assume the company pays $3,400 in dividends or $3,400 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