Selected financial data for these two close competitors in the home building industry are provided below: Company A Company B $33,000 (5 in millions) Total assets Total liabilities Total stockholders' equity Sales Interest expense Tax expense Net income $40,890 21,460 19,430 $66,175 680 1,410 2,670 13,980 19,100 $47,210 380 1,020 1,770 1-a. Calculate the debt to equity ratio for Company A and Company B. (Round your answers to 2 decimal places.) Debt to Equity Ratin

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Selected financial data for these two close competitors in the home building industry are provided below:
Company A Company B
$40,890
$33,000
Total assets
Total liabilities
Total stockholders' equity
($ in millions)
Sales
Interest expense
Tax expense
Net income
Company A
Company B
Company A
Company B
1-a. Calculate the debt to equity ratio for Company A and Company B. (Round your answers to 2 decimal places.)
Debt to
Equity Ratio
1-b. Which company has the higher ratio?
Time Interest
Earned Ratio
21,460
19,430
$66,175
680
1,410
2,670
O Company B
O Company A
O Company A
O Company B
2-a. Calculate the times interest earned ratio for Company A and Company B. (Round your answers to 1 decimal place.)
times
times
13,980
19,100
$47,210
380
1,020
1,770
2-b. Which company is better able to meet interest payments as they become due?
Transcribed Image Text:Selected financial data for these two close competitors in the home building industry are provided below: Company A Company B $40,890 $33,000 Total assets Total liabilities Total stockholders' equity ($ in millions) Sales Interest expense Tax expense Net income Company A Company B Company A Company B 1-a. Calculate the debt to equity ratio for Company A and Company B. (Round your answers to 2 decimal places.) Debt to Equity Ratio 1-b. Which company has the higher ratio? Time Interest Earned Ratio 21,460 19,430 $66,175 680 1,410 2,670 O Company B O Company A O Company A O Company B 2-a. Calculate the times interest earned ratio for Company A and Company B. (Round your answers to 1 decimal place.) times times 13,980 19,100 $47,210 380 1,020 1,770 2-b. Which company is better able to meet interest payments as they become due?
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