a) Times interest earned: The times interest earned ratio calculates the ability of a company to pay off its debts. It is also called as interest coverage ratio. To calculate: The times interest earned ratio
a) Times interest earned: The times interest earned ratio calculates the ability of a company to pay off its debts. It is also called as interest coverage ratio. To calculate: The times interest earned ratio
Definition Definition Assets available to stockholders after a company's liabilities are paid off. Stockholders’ equity is also sometimes referred to as owner's equity. A stockholders’ equity or book value generally includes common stock, preferred stock, and retained earnings and is an indicator of a company's financial strength.
Chapter 14, Problem 7CP
To determine
a) Times interest earned: The times interest earned ratio calculates the ability of a company to pay off its debts. It is also called as interest coverage ratio.
To calculate: The times interest earned ratio
To determine
b) Debt to equity ratio: It is a ratio that indicates the soundness of long-term financial policies of a company. It also measures company’s financial leverage.
To calculate: The Debt to equity ratio
To determine
c) Earnings per share: It calculates the net income earned by the company per outstanding share.
To calculate: Earnings per share
To determine
d) Price Earnings Ratio: The price earnings ratio compares company’s stock price to its earnings per share.
To calculate: The Price Earnings Ratio
To determine
e) Rate of Return on Common Stock: It measures the success of a company in generating income for the common stockholders.
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