Exercise 13-10 (Algo) Part 3 [Alternate Version] (3-a) Compute times interest earned for the current year and one year ago. (3-b) Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 3A Required 3B Compute times interest earned for the current year and one year ago. Times Interest Earned Current Year: 1 Year Ago: Numerator: Income before interest expense and income tax expense < Required 3A 1 1 1 1 Denominator: Interest expense Required 3B > = = Times interest earned 0 times 0 times

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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[The following information applies to the questions displayed below.]
Simon Company's year-end balance sheets follow.
At December 31
Assets
Cash
Accounts receivable, net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Interest expense
Income tax expense
Total costs and expenses
Net income
Current Year
Earnings per share
$ 28,742
85,004
104,739
9,256
269,358
$ 497,099
$ 126,253
92,520
162,500
115,826
$ 497,099
Current Year
$ 394,200
200,331
10,986
8,401
1 Year Ago
Exercise 13-10 (Algo) Part 3 [Alternate Version]
$ 33,597
59,995
81,657
9,179
244,106
$ 428,534
The company's income statements for the current year and one year ago, follow.
For Year Ended December 31
Sales
Cost of goods sold
Other operating expenses
$ 73,871
99,548
162,500
92,615
$ 428,534
$ 646,229
2 Years Ago
613,918
$ 32,311
$ 1.99
$ 35,354
46,658
50,710
4,089
227,589
$364,400
$ 47,620
80,532
162,500
73,748
$364,400
1 Year Ago
$ 331,471
129,019
11,729
7,649
$ 509,955
479,868
$ 30,087
$ 1.85
Transcribed Image Text:[The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity Interest expense Income tax expense Total costs and expenses Net income Current Year Earnings per share $ 28,742 85,004 104,739 9,256 269,358 $ 497,099 $ 126,253 92,520 162,500 115,826 $ 497,099 Current Year $ 394,200 200,331 10,986 8,401 1 Year Ago Exercise 13-10 (Algo) Part 3 [Alternate Version] $ 33,597 59,995 81,657 9,179 244,106 $ 428,534 The company's income statements for the current year and one year ago, follow. For Year Ended December 31 Sales Cost of goods sold Other operating expenses $ 73,871 99,548 162,500 92,615 $ 428,534 $ 646,229 2 Years Ago 613,918 $ 32,311 $ 1.99 $ 35,354 46,658 50,710 4,089 227,589 $364,400 $ 47,620 80,532 162,500 73,748 $364,400 1 Year Ago $ 331,471 129,019 11,729 7,649 $ 509,955 479,868 $ 30,087 $ 1.85
Exercise 13-10 (Algo) Part 3 [Alternate Version]
(3-a) Compute times interest earned for the current year and one year ago.
(3-b) Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago?
Complete this question by entering your answers in the tabs below.
Required 3A Required 3B
Compute times interest earned for the current year and one year ago.
Current Year:
1 Year Ago:
Times Interest Earned
Numerator:
Income before interest expense and income tax expense
< Required 3A
1
1
1
1
Denominator:
Interest expense
Required 3B >
=
=
Times interest earned
0 times
0 times
Transcribed Image Text:Exercise 13-10 (Algo) Part 3 [Alternate Version] (3-a) Compute times interest earned for the current year and one year ago. (3-b) Based on times interest earned, is the company more or less risky for creditors in the Current Year versus 1 Year Ago? Complete this question by entering your answers in the tabs below. Required 3A Required 3B Compute times interest earned for the current year and one year ago. Current Year: 1 Year Ago: Times Interest Earned Numerator: Income before interest expense and income tax expense < Required 3A 1 1 1 1 Denominator: Interest expense Required 3B > = = Times interest earned 0 times 0 times
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