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Comparative financial statements for Heritage Antiquing Services for the fiscal year ending December 31 appear on the following page. The company did not Issue any

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Comparative financial statements for Heritage Antiquing Services for the fiscal year ending December 31 appear on the following page. The company did not Issue any new common or preferred stock during the year. A total of 600,000 shares of common stock were outstanding. The Interest rate on the bond payable was 14%, the income tax rate was 40%, and the dividend per share of common stock was $0.75. The market value of the company's common stock at the end of the year was $26. All of the company's sales are on account. Heritage Antiquing Services comparative Balance sheet (dollars in thousanda) This Last Year Year Assets Current ansetet Canh $ 1,080 $ 1,210 Accounts receivable, net 9,000 6,500 Inventory 12,000 10,600 Prepaid expenses 600 500 Total current assets 22,680 18,810 Property and equipment: Land 9,000 9,000 Buildings and equipment, net 36,800 38,000 Total property and equipment 45,800 47.000 Total assets $68,480 $65,010 Liabilities and stockholders' Equity Current liabilities Accounts payable $ 18,500 $17,400 Accrued payables 900 700 Notes payable, short term 100 Total current liabilities 19,400 18, 200 Long-term liabilities Honda payable 2.000 B,000 Total liabilities 27,400 26,200 Stockholders' equity Preferred stock 1,000 1,000 Common stock 2.000 2.000 Additional paid-in capital 4,000 4,000 Total paid-in capital 7,000 7,000 Retained earnings 34.000 32.610 Total stockholders' equity 41,080 39,610 Total liabilities and stockholdera equity $68,480 $65,810 this Last Yon Year $ 66,000 $ 64,000 43,000 42,000 23,000 22,000 Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Nat operating income Interest expense Net income before taxes Income taxes Net income Dividends to preferred stockholders Net income remaining for common stockholders Dividends to common stockholders Net income added to retained earnings Retained earnings, beginning of year Retained earnings, end of year 11,500 11,000 7,400 7,000 18,900 18,000 4,100 4,000 800 800 3,300 3,200 1,320 1,280 1,980 1,920 60 400 1,920 1,520 450 450 1,470 1,070 32,610 31,540 $ 34,080 $ 32,610 Required: Compute the following financial ratios for long-term creditors for this year: 1. Times interest earned ratio. (Round your answer to 1 decimal place.) Times interest earned ratio 2. Debt-to-equity ratio. (Round your answer to 2 decimal places.)

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