Samantha Knight is applying for a small-business loan. She provides thebank with the following information: cash in checking accounts, $5,000;cash in savings, $10,350; home market value, $145,500; first mortgageon house, $25,000; home equity loan limit, $70,000; home equity loan,$10,000; automobile market value, $19,000; automobile loan outstanding,$15,000; credit card debt, $1,500.a. Calculate the debt-to-asset ratio.b. Calculate the debt-to-equity ratio.c. What percentage of Samantha’s assets are owned by others?
Samantha Knight is applying for a small-business loan. She provides thebank with the following information: cash in checking accounts, $5,000;cash in savings, $10,350; home market value, $145,500; first mortgageon house, $25,000; home equity loan limit, $70,000; home equity loan,$10,000; automobile market value, $19,000; automobile loan outstanding,$15,000; credit card debt, $1,500.a. Calculate the debt-to-asset ratio.b. Calculate the debt-to-equity ratio.c. What percentage of Samantha’s assets are owned by others?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Samantha Knight is applying for a small-business loan. She provides the
bank with the following information: cash in checking accounts, $5,000;
cash in savings, $10,350; home market value, $145,500; first mortgage
on house, $25,000; home equity loan limit, $70,000; home equity loan,
$10,000; automobile market value, $19,000; automobile loan outstanding,
$15,000; credit card debt, $1,500.
a. Calculate the debt-to-asset ratio.
b. Calculate the debt-to-equity ratio.
c. What percentage of Samantha’s assets are owned by others?
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