The following information was available for the year ended December 31, 2019: Earnings before interest and taxes (operating income) Interest expense Income tax expense Net income Total assets at year-end Total liabilities at year-end $105,000 25,000 30,000 50,000 350,000 180,000 Required: a. Čalculate the debt ratio at December 31, 2019. (Round your answer to 1 decimal place.) b. Calculate the debt/equity ratio at December 31, 2019. (Round your answer to 2 decimal places.) c. Calculate the times interest earned for the year ended December 31, 2019. (Round your answer to 2 decimal places.)

The following information was available for the year ended December 31, 2019: Earnings before interest and taxes (operating income) Interest expense Income tax expense Net income Total assets at year-end Total liabilities at year-end $105,000 25,000 30,000 50,000 350,000 180,000 Required: a. Čalculate the debt ratio at December 31, 2019. (Round your answer to 1 decimal place.) b. Calculate the debt/equity ratio at December 31, 2019. (Round your answer to 2 decimal places.) c. Calculate the times interest earned for the year ended December 31, 2019. (Round your answer to 2 decimal places.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

100%

The following information was available for the year ended December 31, 2019:
Earnings before interest and taxes (operating income)
Interest expense
Income tax expense
$105,000
25,000
30,000
50,000
350,000
Net income
Total assets at year-end
Total liabilities at year-end
180,000
Required:
a. Calculate the debt ratio at December 31, 2019. (Round your answer to 1 decimal place.)
b. Calculate the debt/equity ratio at December 31, 2019. (Round your answer to 2 decimal places.)
c. Calculate the times interest earned for the year ended December 31, 2019. (Round your answer to 2 decimal places.)
a. Debt ratio
b. Debt/Equity ratio
c. Times interest earned
%
times
times

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