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Haliburton's financial statements indicate that the company'scurrent assets equal 20 million and 60% of its...

Haliburton's financial statements indicate that the company's current assets equal 20 million and 60% of its assets are financed with common equity, its current ratio is 5.0, total asset turnover is 6.0, and sales equal $900 million.

What is Haliburton's current liabilities?

What is the dollar amount of Haliburton's assets that are financed with debt?

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Expert Solution

Current Assets = $20 million

Current ratio = 5.0

- Current ratio = Current Assets/Current Liabilities

5.0 = $20 million/Current Liabilities

a). Current Liabilities = $4 million

b). Total Assets Turnover = Net sales/Total Assets

6 = $900 million/Total Assets

Total Assets = $150 million

- 60% of Assets are finance from equity which means that other 40% are financed with debts.

Total Assets financed with debt = Total Assets*40%

= $150 million*40%

Total Assets financed with debt = $60 million

SO, the dollar amount of Haliburton's assets that are financed with debt is $60 million

jeff jeffy answered 2 years ago
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