For the FY 2018, Frederick Company had net sales of $1,100,000 and a net income of $55,000, paid income taxes of $30,000, and had a before-tax interest expense of $17,500. Use this information to determine the Times Interest Earned Ratio.

For the FY 2018, Frederick Company had net sales of $1,100,000 and a net income of $55,000, paid income taxes of $30,000, and had a before-tax interest expense of $17,500. Use this information to determine the Times Interest Earned Ratio.

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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Cadux Candy Company's income statement for the year ended December 31, 2021, reported interest expense of $6 million and income tax expense of $32 million. Current assets listed in its balance sheet include cash, accounts receivable, and inventory. Property, plant, and equipment is the company's only noncurrent asset. Financial ratios for 2021 are listed below. Profitability and turnover ratios with balance sheet items in the denominator were calculated using year-end balances rather than averages Debt to equity ratio Current ratio Acid-test ratio. Times interest earned ratio Return on assets Return on equity Profit margin on sales Gross profit margin (gross profit divided by net sales) Inventory turnover Receivables turnover Assets Current assets Cash CADUX CANDY COMPANY Balance Sheet At December 31, 2021 (All values are in millions) Required: Prepare a December 31, 2021, balance sheet for the Cadux Candy Company. (Enter your answers in millions. Round your intermediate calculations…
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How do I calculae the times interest earned ratio?
During 2020, Rumbo Corporation had cash and credit sales of $21,760 and $15,225, respectively. The company also collected accounts receivable of $9,765 and incurred operating expenses of $27,700, 80% of which were paid during the year. In addition, Rumbo prepaid $4,500 for an 18-month advertising campaign that began September 30. Rumbo’s accrual basis net income (loss) for the fiscal year ending December 31, 2020, was: a $14,075 b $9,285 c $8,535 d ($775)
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The table below contains data on Fincorp Incorporated. The balance sheet items correspond to values at year-end 2021 and 2022, while the income statement items correspond to revenues or expenses during the year ending in either 2021 or 2022. All values are in thousands of dollars. Revenue Cost of goods sold Depreciation Inventories Administrative expenses Interest expense Federal and state taxes Accounts payable Accounts receivable 2021 $ 4.500 1,900 600 290 540 130 420 280 440 Price 5,300 1.800 856 440 850 per share 2022 $ 4.600 2,000 620 350 590 Net fixed assets Long-tern debt Notes payable Dividends paid Cash and marketable securities *Taxes are paid in their entirety in the year that the tax obligation is incurred. 130 440 320 510 6. 190 *Net fixed assets are fixed assets net of accumulated depreciation since the asset was installed. Suppose that the market value (in thousands of dollars) of Fincorp's fixed assets in 2022 is $6,500 and that the value of its long-term debt is only…
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