Total assets $120,668 Total liabilities $871 Total equity $119,797

Required:
1.

The bank has offered a long-term secured note to Success Systems. The bank’s loan procedures require that a client’s debt-to-equity ratio not exceed 0.84. As of March 31, 2014, what is the maximum amount that Success Systems could borrow from this bank? (Round your intermediate calculations to the nearest dollar amount.)


2. Assume Success Systems borrows the maximum amount allowed from the bank.

(a)

What percentage of assets would be financed by debt? (Round your intermediate dollar values to the nearest whole number and final answer to 1 decimal place.)


(b)

What percentage of assets would be financed by equity?