The following information was available for the year ended December 31, 2024: • • . Earnings before interest and taxes (EBIT): $120,000 Interest expense: $20,000 Income tax expense: $30,000 Net income: $70,000 Total assets at year-end: $360,000 Total liabilities at year-end: $252,000 Required: (a) Calculate the debt ratio at December 31, 2024. (b) Calculate the debt/equity ratio at December 31, 2024. (c) Calculate the times interest earned for the year ended December 31, 2024.

The following information was available for the year ended December 31, 2024: • • . Earnings before interest and taxes (EBIT): $120,000 Interest expense: $20,000 Income tax expense: $30,000 Net income: $70,000 Total assets at year-end: $360,000 Total liabilities at year-end: $252,000 Required: (a) Calculate the debt ratio at December 31, 2024. (b) Calculate the debt/equity ratio at December 31, 2024. (c) Calculate the times interest earned for the year ended December 31, 2024.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 50E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...

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Mackenzie Corp. is preparing the December 31, 2023, year-end financial statements. Following are selected unadjusted account balances: Estimated warranty liability Income tax expense Mortgage payable, 5% View transaction list Additional information: a. $11,800 of income tax was accrued monthly from January through to November inclusive and paid on the 15th day of the following month. The actual amount of tax expense for the year is determined to be $136,040. b. A customer is suing the company. Legal advisers believe it is probable that the company will have to pay damages, the amount of which will approximate $150,000 given similar cases in the industry. c. During December, Mackenzie had sales of $720,000. 5% of sales typically require warranty work equal to 25% of the sales amount. d. Mortgage payments are made on the first day of each month. e. $112,500 of the Unearned Revenues remain unearned at December 31, 2023. f. The 120-day note payable was dated November 15, 2023. No 1 $ 6,560…
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