[The following information applies to the questions displayed below.] The current balance sheet of Gamma reports total assets of $30 million, total liabilities of $3 million, and owners’ equity of $27 million. Gamma is considering several financing possibilities in order to expand operations. Each question based on this data is independent of any others. Assume Gamma borrows $5 million to finance its expansion. Gamma’s debt ratio immediately after the borrowing will be (rounded):

A. 0.11.
B. 0.23.
C. 0.35.
D. 0.30.


B. 0.23.