Ratio of liabilities to stockholders' equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Previous Year Accounts payable $716,000 $171,000 Current maturities of serial bonds payable 420,000 420,000 Serial bonds payable, 10% 1,680,000 2,100,000 Common stock, $1 par value 70,000 90,000 Paid-in capital in excess of par 770,000 780,000 Retained earnings 2,680,000 2,120,000 The income before income tax expense was $756,000 and $661,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round your answers to one decimal place. Current year Previous year b. Determine the times interest earned ratio for both years. Round your answers to one decimal place. Current year Previous year Current Year

Ratio of liabilities to stockholders' equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Previous Year Accounts payable $716,000 $171,000 Current maturities of serial bonds payable 420,000 420,000 Serial bonds payable, 10% 1,680,000 2,100,000 Common stock, $1 par value 70,000 90,000 Paid-in capital in excess of par 770,000 780,000 Retained earnings 2,680,000 2,120,000 The income before income tax expense was $756,000 and $661,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round your answers to one decimal place. Current year Previous year b. Determine the times interest earned ratio for both years. Round your answers to one decimal place. Current year Previous year Current Year

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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