Rudy Company has total assets, liabilities, and shareholders' equity of $35,000, $28,000, and $7,000, respectively. Assume no material change occurred during the year to totals on the balance sheet. What amount of long-term debt must Rudy exchange for new shares of common stock issued in order to decrease its debt/equity ratio to 1.0?
a. $17,500
b. $10,500
c. $14,000
d. $21,000

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The Answer of Rudy Company has total assets, liabilities, and shareholders' equity of $35,000, $28,000, and $7,000, respectively. Assume no material change occurred during the year to totals on the balance sheet. What amount of long-term debt must Rudy exchange for new shares of common stock issued in order to decrease its debt/equity ratio to 1.0?
a. $17,500
b. $10,500
c. $14,000
d. $21,000

Rudy Company Has Total Assets, Liabilities, and Shareholders' Equity of $35,000