-20Υ8 Return on total assets 24.4% Return on stockholders' equity 50.1% Times interest earned 4.6

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Please answer all parts with explanations thx also need times interest earned for 2014- 2018 and ratio of liabilities to stockholders equity for 2014-2018
Requlred:
1. Determine the following for the years 20Y4 through 20Y8. Round to one decimal place:
a. Return on total assets:
20Y8
%
20Υ7
20Υ6
20Y5
20Υ4
%
b. Return on stockholders' equity:
20Υ8
20Υ7
20Y6
%
20Y5
%
20Y4
%
c. Times interest earned:
20Y8
EUS
$4
%
&
*
5
6.
7
8
9.
t
y
C
m
Transcribed Image Text:Requlred: 1. Determine the following for the years 20Y4 through 20Y8. Round to one decimal place: a. Return on total assets: 20Y8 % 20Υ7 20Υ6 20Y5 20Υ4 % b. Return on stockholders' equity: 20Υ8 20Υ7 20Y6 % 20Y5 % 20Y4 % c. Times interest earned: 20Y8 EUS $4 % & * 5 6. 7 8 9. t y C m
Solvency and Profitability Trend Analysis
Addal Company has provided the following comparative information:
20Y8
20Υ7
20Y6
20Y5
20Y4
Net income
$1,221,900 $1,053,400.
$885,200
$756,600
$641,200
Interest expense
415,400
379,200
327,500
249,700
198,800
Income tax expense
391,008
294,952
247,856
196,716
153,888
Total assets (ending balance)
6,470,085
6,787,405 4,907,289 5,073,781 3,847,617
Total stockholders' equity (ending
balance)
2,090,074
2,494,916 1,595,958 1,966,216 1,179,730
Average total assets
6,628,745
5,847,347 4,990,535 4,228,151
3,589,744
Average stockholders' equity
2,292,495
2,045,437 1,781,087 1,572,973 1,373,019
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
20Υ4-20Υ8
Return on total assets
24.4%
Return on stockholders' equity
50.1%
Times interest earned
4.6
Ratio of liabilities to stockholders' equity
2.1
$4
&
6.
7
8
9
y
k
m
ctrl
Transcribed Image Text:Solvency and Profitability Trend Analysis Addal Company has provided the following comparative information: 20Y8 20Υ7 20Y6 20Y5 20Y4 Net income $1,221,900 $1,053,400. $885,200 $756,600 $641,200 Interest expense 415,400 379,200 327,500 249,700 198,800 Income tax expense 391,008 294,952 247,856 196,716 153,888 Total assets (ending balance) 6,470,085 6,787,405 4,907,289 5,073,781 3,847,617 Total stockholders' equity (ending balance) 2,090,074 2,494,916 1,595,958 1,966,216 1,179,730 Average total assets 6,628,745 5,847,347 4,990,535 4,228,151 3,589,744 Average stockholders' equity 2,292,495 2,045,437 1,781,087 1,572,973 1,373,019 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years: 20Υ4-20Υ8 Return on total assets 24.4% Return on stockholders' equity 50.1% Times interest earned 4.6 Ratio of liabilities to stockholders' equity 2.1 $4 & 6. 7 8 9 y k m ctrl
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