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At May 31, 2019, FOR Deliveries reported the following amounts (in millions) in its financial statements: 2018 $ 68,000 42,160 Total Assets Total Liabilities Interest Expense Income Tax Expense. Net Incone 2019 $70,000 46,200 736 155 780 750 60 6,275 Required: 1. Compute the debt-to-assets ratio and times interest earned ratio for 2019 and 2018. 2-a. In 2019, were creditors providing a greater (or lesser) proportion of financing for FOR's assets? 2-b. In 2019, was FOR more (or less) successful at covering its interest costs, as compared to 2018?

At May 31, 2019, FOR Deliveries reported the following amounts (in millions) in its financial statements: 2018 $ 68,000 42,160 Total Assets Total Liabilities Interest Expense Income Tax Expense. Net Incone 2019 $70,000 46,200 736 155 780 750 60 6,275 Required: 1. Compute the debt-to-assets ratio and times interest earned ratio for 2019 and 2018. 2-a. In 2019, were creditors providing a greater (or lesser) proportion of financing for FOR's assets? 2-b. In 2019, was FOR more (or less) successful at covering its interest costs, as compared to 2018?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At May 31, 2019, FOR Deliveries reported the following amounts (in millions) in its financial statements: Total Assets Total Liabilities Interest Expense Income Tax Expense Net Income 2019 $ 70,000 46,200 736 155 780 2018 $ 68,000 42,160 750 260 6,275 Required: 1. Compute the debt-to-assets ratio and times interest earned ratio for 2019 and 2018. 2-a. In 2019, were creditors providing a greater (or lesser) proportion of financing for FOR's assets? 2-b. In 2019, was FOR more (or less) successful at covering its interest costs, as compared to 2018?
Transcribed Image Text:At May 31, 2019, FOR Deliveries reported the following amounts (in millions) in its financial statements: Total Assets Total Liabilities Interest Expense Income Tax Expense Net Income 2019 $ 70,000 46,200 736 155 780 2018 $ 68,000 42,160 750 260 6,275 Required: 1. Compute the debt-to-assets ratio and times interest earned ratio for 2019 and 2018. 2-a. In 2019, were creditors providing a greater (or lesser) proportion of financing for FOR's assets? 2-b. In 2019, was FOR more (or less) successful at covering its interest costs, as compared to 2018?
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