Gurrent Previous Year Year Accounts payable $ 924,000 $ 800,000 Gurrent maturities of serial bonds 200,000 200,000 | раyable Serial bonds payable. 10% 1,000,000 1,200,000 Common stock $10 par value 250,000 250,000 Paid-in capital in excess of par 1,250,000 1,250,000 Retained earnings 860,000 500,000
Gurrent Previous Year Year Accounts payable $ 924,000 $ 800,000 Gurrent maturities of serial bonds 200,000 200,000 | раyable Serial bonds payable. 10% 1,000,000 1,200,000 Common stock $10 par value 250,000 250,000 Paid-in capital in excess of par 1,250,000 1,250,000 Retained earnings 860,000 500,000
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
ChapterD: Investments
Section: Chapter Questions
Problem D.1EX
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Question
Ratio of liabilities to
The following data were taken from the financial statements of Hunters Inc.for December 31 of two recent years:
The income before income tax was $480,000 and $420,000 for the current and previous years,respectively.
a. Determine the ratio of liabilities to stockholders equity at the end of each year.Round to one decimal place.
b. Determine the times interest earned ratio for both years.Round to one decimal place.
c. What conclusion can be drawn from these data as the company's ability to meet its currently maturing debts?
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