Santana Rey has consulted with her local banker and is considering financing an expansion of her business by obtaining a long-term bank loan. Selected account balances at March 31, 2022, for Business Solutions follow.

Total assets

$121,668

Total liabilities

$861

Total equity

$120,807

Required:

The bank has offered a long-term secured note to Business Solutions. The banks loan procedures require that a clients debt-to-equity ratio not exceed 0.76. As of March 31, 2022, what is the maximum amount that Business Solutions could borrow from this bank?

Note: Round your intermediate calculations to the nearest dollar amount.

Assume Business Solutions borrows the maximum amount allowed from the bank.

Note: Round your intermediate dollar values to the nearest whole number and final answers to 1 decimal place.

(a) What percentage of assets would be financed by debt?

(b) What percentage of assets would be financed by equity?