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2 years ago

Ratios Analyzing Long-Term Firm Solvency

Business

1 answer:

Tpy6a [65]2 years ago

4 0

Answer:

0.57 and 9.24 times

Explanation:

The computation is shown below:

a. Debt to equity ratio

= Total Liabilities ÷ Share holders' equity

= $2,400,000 ÷ $4,200,000

= 0.57

And, the times interest earned ratio is

= EBIT ÷ interest expense

where,

EBIT is

= Net income + taxes + interest

= $496,500 + $203,500 + $85,000

= $785,000

And, the interest expense is $85,000

So, times interest earned ratio is

= $785,000 ÷ $85,000

= 9.24 times

We simply applied the above formulas

Plus the year is 2019 not 2016

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The Hawkins Supply company is currently faced with an inventory rotation problem. This difficulty stems from the fact that some

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Here's the completed question.

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Answer:

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2 years ago

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Answer:

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alexdok [17]

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