Question
Exercise 9-23 (Algo) Calculate and analyze ratios (LO9-8) Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: E-Travel Pricecheck Total assets
Exercise 9-23 (Algo) Calculate and analyze ratios (LO9-8) Two online travel companies, E-Travel and Pricecheck, provide the following selected financial data: E-Travel Pricecheck Total assets $ 5,487,156 $ 1,756,224 Total liabilities 2,954,475 473,610 Total stockholders equity 2,532,681 1,282,614 Sales revenue $ 2,805,426 $ 2,188,212 Interest expense 81,233 21,084 Income tax expense 148,400 44,168 Net income 293,526 483,472 Required: 1-a. Calculate the debt to equity ratio for E-Travel and Pricecheck. 1-b. Which company has higher leverage risk? 2-a. Calculate the times interest earned ratio for E-Travel and Pricecheck. 2-b. Which company is better able to meet interest payments as they become due?
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