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: Current Year Prior Year Accounts payable $570,000 $280,000 Current maturities of serial bonds payable 500,000 500,000 Serial bonds payable, 10% 2,250,000 2,750,000 Common stock, $1 par value 90,000 100,000 Paid-in capital in excess of par 910,000 920,000 Retained earnings 3,150,000 2,510,000 The income before income tax expense was $797,500 and $697,800 for the current and prior years, respectively. b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Prior 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: Current Year Prior Year Accounts payable $570,000 $280,000 Current maturities of serial bonds payable 500,000 500,000 Serial bonds payable, 10% 2,250,000 2,750,000 Common stock, $1 par value 90,000 100,000 Paid-in capital in excess of par 910,000 920,000 Retained earnings 3,150,000 2,510,000 The income before income tax expense was $797,500 and $697,800 for the current and prior years, respectively. b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Prior year
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ratio of Liabilities to
The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years:
| Current Year | Prior Year | |||
| Accounts payable | $570,000 | $280,000 | ||
| Current maturities of serial bonds payable | 500,000 | 500,000 | ||
| Serial bonds payable, 10% | 2,250,000 | 2,750,000 | ||
| Common stock, $1 par value | 90,000 | 100,000 | ||
| Paid-in capital in excess of par | 910,000 | 920,000 | ||
| 3,150,000 | 2,510,000 |
The income before income tax expense was $797,500 and $697,800 for the current and prior years, respectively.
b. Determine the times interest earned ratio for both years. Round to one decimal place.
| Current year | |
| Prior year |
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