Question

Total assets of WhiteWave Foods equals $4,383.3 million and its equity is $1,502 million.

1) What is the amount of its liabilities?

2 )Does WhiteWave Foods receive more financing from its owners or nonowners?

3) Round answer to one decimal place (i.e. 51.8%) What percentage of financing is provided by its owners?

Answer 1

1. Total assets= Equity+ Debt

Debt = 4383.3-1502 = 2881.3

2. White wave food will receive more finance from owners because as companies gearing is very high so it is difficult to raise funds from non owners. If company wants to raise funds from non owners then cost of debt will be very high that will make raising finance very expensive.

3. Financing provided by it's owner is equity as equity holder's are owners of company.

Finance provided by it's owner= equity/total asset

= 34.27%