Ratio of liabilities to stockholders' equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Current Previous Year Year Accounts payable $464,000 $220,000 Current maturities of serial bonds payable 410,000 410,000 Serial bonds payable, 10% 1,830,000 2,240,000 Common stock, $1 par value 70,000 80,000 Paid-in capital in excess of par 740,000 750,000 Retained earnings 2,570,000 2,040,000 The income before income tax expense was $806,400 and $705,600 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round your answers to one decimal place. Current year 0.8 V Previous year 1 b. Determine the times interest earned ratio for both years. Round your answers to one decimal place. Current year Previous VARE 4.15 X

Ratio of liabilities to stockholders' equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Current Previous Year Year Accounts payable $464,000 $220,000 Current maturities of serial bonds payable 410,000 410,000 Serial bonds payable, 10% 1,830,000 2,240,000 Common stock, $1 par value 70,000 80,000 Paid-in capital in excess of par 740,000 750,000 Retained earnings 2,570,000 2,040,000 The income before income tax expense was $806,400 and $705,600 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round your answers to one decimal place. Current year 0.8 V Previous year 1 b. Determine the times interest earned ratio for both years. Round your answers to one decimal place. Current year Previous VARE 4.15 X

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 13E: Ratio of liabilities to stockholders equity and times interest earned The following data were taken...

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Ratio of liabilities to stockholders equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: The income before income tax expense 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 conclusions can be drawn from these data as to the companys ability to meet its currently maturing debts?
Ernst Companys balance sheet shows total liabilities of 32,500,000, total stockholders equity of 8,125,000, and total assets of 40,625,000. Required: Note: Round answers to two decimal places. 1. Calculate the debt ratio. 2. Calculate the debt-to-equity ratio.
Ratio of Liabilities to Stockholders' Equity and Times Interest Earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: CurrentYear PreviousYear Accounts payable $698,000 $212,000 Current maturities of serial bonds payable 460,000 460,000 Serial bonds payable, 10% 1,920,000 2,380,000 Common stock, $1 par value 100,000 130,000 Paid-in capital in excess of par 1,130,000 1,130,000 Retained earnings 3,900,000 3,100,000 The income before income tax expense was $714,000 and $624,800 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. Current year fill in the blank 1 Previous year fill in the blank 2 b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year fill in the blank 3 Previous year fill in the blank 4
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