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Listed below is the ACME Toy Company's Liabilities and Owner's Equity Section from their financial statements. a. What is the company's debt ratio and interest-bearing
| Listed below is the ACME Toy Company's Liabilities and Owner's | |||||||
| Equity Section from their financial statements. | |||||||
| a. What is the company's debt ratio and interest-bearing debt ratio? | |||||||
| b. If the market value of the company is $50 million dollars, what is the firm's | |||||||
| debt to value ratio? (Assume the market value of the firm's interst-bearing debt | |||||||
| equals its book value) | |||||||
| Liabilities | |||||||
| Current liabilities | |||||||
| AP | 10,000,000 | ||||||
| Current Debt | 2,000,000 | ||||||
| Total Current Liabilities | 12,000,000 | ||||||
| Long Term Debt | 40,000,000 | ||||||
| Stockholder's Equiity | 14,500,000 | ||||||
| 1 | 66,500,000 | ||||||
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