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Calculate the following leverage ratios for 2020. Debt ratio- Debt-to-equity- Times interest earned ratio-

Calculate the following leverage ratios for 2020. Debt ratio- Debt-to-equity- Times interest earned ratio-

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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Calculate the following leverage ratios for 2020. Debt ratio- Debt-to-equity- Times interest earned ratio-
Blossom Medical manufactures hospital beds and other institutional furniture. The company's comparative balance sheet and income statement for 2019 and 2020 follow. Assets Current assets Cash Accounts receivable, net Inventory Other current assets Total current assets Blossom Medical Comparative Balance Sheet As of December 31 Property, plant, & equipment, net Total assets Liabilities and Stockholders' Equity Current liabilities Long-term debt Total liabilities Preferred stock, $5 par value Common stock, $0.25 par value Retained earnings Total stockholders' equity 2020 $361,000 1,080,000 738,000 381,300 2,560,300 8,711,140 $11,271,440 $3,210,000 3,702,700 6,912,700 58,950 104,650 4,195,140 4,358,740 Total liabilities and stockholders' equity $11,271,440 2019 $417,400 776,500 681,100 247,000 2,122,000 8,440,245 $10,562,245 $2,846,050 3,892,700 6,738,750 59,000 103,900 3,660,595 3,823,495 $10,562,245
Transcribed Image Text:Blossom Medical manufactures hospital beds and other institutional furniture. The company's comparative balance sheet and income statement for 2019 and 2020 follow. Assets Current assets Cash Accounts receivable, net Inventory Other current assets Total current assets Blossom Medical Comparative Balance Sheet As of December 31 Property, plant, & equipment, net Total assets Liabilities and Stockholders' Equity Current liabilities Long-term debt Total liabilities Preferred stock, $5 par value Common stock, $0.25 par value Retained earnings Total stockholders' equity 2020 $361,000 1,080,000 738,000 381,300 2,560,300 8,711,140 $11,271,440 $3,210,000 3,702,700 6,912,700 58,950 104,650 4,195,140 4,358,740 Total liabilities and stockholders' equity $11,271,440 2019 $417,400 776,500 681,100 247,000 2,122,000 8,440,245 $10,562,245 $2,846,050 3,892,700 6,738,750 59,000 103,900 3,660,595 3,823,495 $10,562,245
Blossom Medical Comparative Income Statement and Statement of Retained Earnings For the Year Sales revenue (all on account) Cost of goods sold Gross profit Operating expenses Net operating income Interest expense Net income before taxes Income taxes (30%) Net income Dividends paid Preferred dividends Common dividends Total dividends paid Net income retained Retained earnings, beginning of year Retained earnings, end of year 2020 $10,177,250 5,611,750 4,565,500 2,840,300 1,725,200 300,350 1,424,850 427,455 $997,395 29,450 433,400 462,850 534,545 3,660,595 $4,195,140 2019 $9,614,000 5,298,800 4,315,200 2,634,200 1,681,000 308,650 1,372,350 411,705 $960,645 29,450 413,000 442,450 518,195 3,142,400 $3,660,595
Transcribed Image Text:Blossom Medical Comparative Income Statement and Statement of Retained Earnings For the Year Sales revenue (all on account) Cost of goods sold Gross profit Operating expenses Net operating income Interest expense Net income before taxes Income taxes (30%) Net income Dividends paid Preferred dividends Common dividends Total dividends paid Net income retained Retained earnings, beginning of year Retained earnings, end of year 2020 $10,177,250 5,611,750 4,565,500 2,840,300 1,725,200 300,350 1,424,850 427,455 $997,395 29,450 433,400 462,850 534,545 3,660,595 $4,195,140 2019 $9,614,000 5,298,800 4,315,200 2,634,200 1,681,000 308,650 1,372,350 411,705 $960,645 29,450 413,000 442,450 518,195 3,142,400 $3,660,595
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