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Please explain how you got the amounts Thank you Required information [The following information applies to the questions displayed below.] Thrillville has $39.4 million in
Please explain how you got the amounts
Thank you
Required information [The following information applies to the questions displayed below.] Thrillville has $39.4 million in bonds payable. One of the contractual agreements in the bond is that the debt to equity ratio cannot exceed 2.0. Thrillville's total assets are $79.4 million, and its liabilities other than the bonds payable are $9.4 million. The company is considering some additional financing through leasing. he company enters a lease agreement requiring lease payments with a present value of \$14.4 million. -a. Will entering into the lease cause the debt to equity ratio to be in violation of the contractual agreement in the bond? -b. Determine your answer by calculating the debt to equity ratio after recording the lease. Complete this question by entering your answers in the tabs below. The company enters a lease agreement requiring lease payments with a present value of $14.4 million. Determine your answer by calculating the debt to equity ratio after recording the lease. (Enter your answers in millions (i.e., $5,500,000 should be entered as 5.5) rounded to 1 decimal place. Round ratio answer to 2 decimal places.)Step by Step Solution
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