The data below are for Evie Company. Total assets $10,000 Income before interest and taxes 1,000 Total liabilities 5,500 Total equity 4,500 Interest expense 400 Sales 15,000 Cost of goods sold 9,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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**11. Financial Analysis: Evie Company**

The data below are for Evie Company:

- **Total assets**: $10,000
- **Income before interest and taxes**: $1,000
- **Total liabilities**: $5,500
- **Total equity**: $4,500
- **Interest expense**: $400
- **Sales**: $15,000
- **Cost of goods sold**: $9,000
- **Accounts payable**: $1,200
- **Accounts receivable**: $1,500

**Question**: What is Evie Company's TIMES INTEREST EARNED RATIO?
- [ ] 0.04
- [ ] 15.00
- [ ] 0.40
- [ ] 0.07
- [ ] 2.50

---

**12. Financial Analysis: Skye Company**

The data below are for Skye Company:

- **Total assets**: $10,000
- **Income tax expense**: $1,000
- **Accounts receivable**: $2,500
- **Total equity**: $6,500
- **Interest expense**: $400
- **Sales**: $15,000
- **Cost of goods sold**: $9,000
- **Accounts payable**: $1,200
- **Net income**: $1,500

**Question**: What is Evie Company's DEBT-TO-EQUITY RATIO?
- [ ] 0.54
- [ ] 1.22
- [ ] 0.80
- [ ] 0.45
- [ ] 0.60

---

**13. Mortgage Calculation**

You owe $300,000 on a mortgage loan. The loan is to be repaid in equal payments at the end of each month for the next 30 years. The interest rate on the loan is 4.35%, compounded monthly.

**Question**: What is the amount of each of the monthly mortgage payments?
- [ ] $1,493.44
- [ ] $1,087.50
- [ ] $1,507.81
- [ ] $9,046.89
- [ ] $13,050.00

--- 

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Transcribed Image Text:Certainly! Below is a transcription suitable for an educational website: --- **11. Financial Analysis: Evie Company** The data below are for Evie Company: - **Total assets**: $10,000 - **Income before interest and taxes**: $1,000 - **Total liabilities**: $5,500 - **Total equity**: $4,500 - **Interest expense**: $400 - **Sales**: $15,000 - **Cost of goods sold**: $9,000 - **Accounts payable**: $1,200 - **Accounts receivable**: $1,500 **Question**: What is Evie Company's TIMES INTEREST EARNED RATIO? - [ ] 0.04 - [ ] 15.00 - [ ] 0.40 - [ ] 0.07 - [ ] 2.50 --- **12. Financial Analysis: Skye Company** The data below are for Skye Company: - **Total assets**: $10,000 - **Income tax expense**: $1,000 - **Accounts receivable**: $2,500 - **Total equity**: $6,500 - **Interest expense**: $400 - **Sales**: $15,000 - **Cost of goods sold**: $9,000 - **Accounts payable**: $1,200 - **Net income**: $1,500 **Question**: What is Evie Company's DEBT-TO-EQUITY RATIO? - [ ] 0.54 - [ ] 1.22 - [ ] 0.80 - [ ] 0.45 - [ ] 0.60 --- **13. Mortgage Calculation** You owe $300,000 on a mortgage loan. The loan is to be repaid in equal payments at the end of each month for the next 30 years. The interest rate on the loan is 4.35%, compounded monthly. **Question**: What is the amount of each of the monthly mortgage payments? - [ ] $1,493.44 - [ ] $1,087.50 - [ ] $1,507.81 - [ ] $9,046.89 - [ ] $13,050.00 --- This content can be used
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