Given below is the most recent balance sheet of Carousel Company.

a. Describe the firm€™s capital structure.
b. How would the capital structure be different if the company had raised the needed capital by issuing additional stock instead of the bonds that are due in 2008?

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Carousel Company Balance Sheet at December 3, 2004 Assets Cash Accounts receivable Prepaid rent Inventory Machinery Land Liabilities and equity Accounts payable Wages payable Bonds payable (due 2008) Common stock Retained earnings Treasury stock $6,000 13,200 2,800 $ 3,100 3,000 33.000 17,000 17,400 (14,000) $59,500 10,000conds 14,000 13,500 Total assets Total liabilities and equity