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The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Current Year Accounts payable $835,000 $218,000 Current maturities of serial bonds payable 520,000 520,000 Serial bonds payable, 10% 2,110,000 2,630,000 Common stock, $1 par value 100,000 130,000 Paid-in capital in excess of par 1,090,000 1,090,000 Retained earnings 3,760,000 2,990,000 The income before income tax expense was $1,025,700 and $897,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round to one decimal place. Current year Previous year Previous Year b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Previous year

The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Current Year Accounts payable $835,000 $218,000 Current maturities of serial bonds payable 520,000 520,000 Serial bonds payable, 10% 2,110,000 2,630,000 Common stock, $1 par value 100,000 130,000 Paid-in capital in excess of par 1,090,000 1,090,000 Retained earnings 3,760,000 2,990,000 The income before income tax expense was $1,025,700 and $897,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round to one decimal place. Current year Previous year Previous Year b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Previous year

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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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 Previous Year Accounts payable $835,000 $218,000 Current maturities of serial bonds payable 520,000 520,000 Serial bonds payable, 10% 2,110,000 2,630,000 Common stock, $1 par value 100,000 130,000 Paid-in capital in excess of par 1,090,000 1,090,000 Retained earnings 3,760,000 2,990,000 The income before income tax expense was $1,025,700 and $897,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round to one decimal place. Current year Previous year b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Previous year
Transcribed Image Text: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 Previous Year Accounts payable $835,000 $218,000 Current maturities of serial bonds payable 520,000 520,000 Serial bonds payable, 10% 2,110,000 2,630,000 Common stock, $1 par value 100,000 130,000 Paid-in capital in excess of par 1,090,000 1,090,000 Retained earnings 3,760,000 2,990,000 The income before income tax expense was $1,025,700 and $897,500 for the current and previous years, respectively. a. Determine the ratio of liabilities to stockholders' equity at the end of each year. Round to one decimal place. Current year Previous year b. Determine the times interest earned ratio for both years. Round to one decimal place. Current year Previous year
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