Exercise $10-16($Algo$)$ Applying debt$-$to$-$equity ratio LO A$2$

Montclair Company is considering a project that will require a $$600,000$ loan. It presently has total liabilities of $$170,000$ and total assets of $$670,000.$

Compute Montclair$$s

$($a$)$ current debt$-$to$-$equity ratio and$($b$)$ the debt$-$to$-$equity ratio assuming it borrows $$600,000$ to fund the project.

If Montclair borrows the funds, does its financing structure become more or less risky?