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Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due?

Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due?

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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Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: Total assets Total liabilities Total stockholders' equity Sales revenue Interest expense Income tax expense Net income Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due? Complete this question by entering your answers in the tabs below. Re E-Travel E-Travel Pricecheck $ 5,037,156 2,654,475 2,382,681 11 $ 2,655,426 $ 1,678,224 470,610 1,207,614 $ 2,038,212 18,084 41,168 477,472 78,233 142,400 287,526 Req 1b. Pricecheck Req 2a Calculate the debt to equity ratio for E-Travel and Pricecheck. (Round ratios to 2 decimal places.) Debt to Equity Ratio 2b Numerator/Denominator < Req 1a Amounts Req 1b > 0 0
Transcribed Image Text:Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: Total assets Total liabilities Total stockholders' equity Sales revenue Interest expense Income tax expense Net income Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due? Complete this question by entering your answers in the tabs below. Re E-Travel E-Travel Pricecheck $ 5,037,156 2,654,475 2,382,681 11 $ 2,655,426 $ 1,678,224 470,610 1,207,614 $ 2,038,212 18,084 41,168 477,472 78,233 142,400 287,526 Req 1b. Pricecheck Req 2a Calculate the debt to equity ratio for E-Travel and Pricecheck. (Round ratios to 2 decimal places.) Debt to Equity Ratio 2b Numerator/Denominator < Req 1a Amounts Req 1b > 0 0
Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: E-Travel $ 5,037,156 2,654,475 2,382,681 $ 2,655,426 Pricecheck $ 1,678,224 470, 610 1,207,614 $ 2,038,212 Total assets Total liabilities Total stockholders' equity Sales revenue Interest expense Income tax expense Net income Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due? Req 1a Complete this question by entering your answers in the tabs below. Req 1b 78,233 142,400 287,526 Req 2a Which company has higher leverage risk? Which company has higher leverage risk? 18,084 41,168 477,472 Req 2b < Req 1a Req 2a >
Transcribed Image Text:Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: E-Travel $ 5,037,156 2,654,475 2,382,681 $ 2,655,426 Pricecheck $ 1,678,224 470, 610 1,207,614 $ 2,038,212 Total assets Total liabilities Total stockholders' equity Sales revenue Interest expense Income tax expense Net income Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due? Req 1a Complete this question by entering your answers in the tabs below. Req 1b 78,233 142,400 287,526 Req 2a Which company has higher leverage risk? Which company has higher leverage risk? 18,084 41,168 477,472 Req 2b < Req 1a Req 2a >
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