
Concept explainers
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
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
c) Earnings per share: It calculates the net income earned by the company per outstanding share.
To calculate: Earnings per share
d) Price Earnings Ratio: The price earnings ratio compares company’s stock price to its earnings per share.
To calculate: The Price Earnings Ratio
e)
To calculate: The Rate of Return on Common Stock

Trending nowThis is a popular solution!

Chapter 14 Solutions
EBK HORNGREN'S ACCOUNTING
- Suppose a stock had an initial price of $66 per share, paid a dividend of $1.8 per share during the year, and had an ending share price of $80. Compute the percentage of total return. a. 23.94% b. 19.75% c. 29.70% d. 25.14%arrow_forwardAccounting answer with solutionarrow_forwardAccounting answer with correct solutionarrow_forward
- Valley Tech Inc. reported the following balances at the end of the year: Credit Sales: $250,000 Accounts Receivable: $45,000 Allowance for Uncollectible Accounts before adjustment: $2,000 debit Valley Tech estimates that 5% of the credit sales will be uncollectible. What is the net realizable value of accounts receivable after the year-end adjustment?arrow_forwardXYZ Co. has an average collection period of 45 days. Total credit sales for the year were $3,200,000. What is the balance in accounts receivable at year-end? (Use 360 days in a year. Round to the nearest dollar.)arrow_forwardProvide Answerarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education





