g Merchant Company purchased property for a building site. The costs associated with the property were: Purchase price $ 195,000 Real estate commissions 17,000 Legal fees 2,800 Expenses of clearing the land 4,000 Expenses to remove old building 3,000 What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building

Anew firm is developing its business plan. it will require $615,000 of assets, and it projects $450,000 of sales and $355,000 of operating costs for the first year. management is reasonably sure of these numbers because of contracts with its customers and suppliers. it can borrow at a rate of 7.5%, but the bank requires it to have a tie of at least 4.0, and if the tie falls below this level the bank will call in the loan and the firm will go bankrupt. what is the maximum debt ratio the firm can use? (hint: find the maximum dollars of interest, then the debt that produces that interest, and then the related debt ratio.)a. 41.94%b. 44.15%c. 46.47%d. 48.92%e. 51.49%