Hattendorf Consulting has a current debt ratio of 40 percent, and it needs to raise $200,000 to expand production. Management feels that its current debt ratio is too high and that an optimal debt ratio would be 30 percent. Sales are currently $2,000,000, and its total assets turnover is 8.0. How should the expansion be financed so Hattendorf reaches its desired debt ratio?

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The Answer of Hattendorf Consulting has a current debt ratio of 40 percent, and it needs to raise $200,000 to expand production. Management feels that its current debt ratio is too high and that an optimal debt ratio would be 30 percent. Sales are currently $2,000,000, and its total assets turnover is 8.0. How should the expansion be financed so Hattendorf reaches its desired debt ratio?

Hattendorf Consulting Has a Current Debt Ratio of 40 Percent