From the income statement:

Depreciation expense Interest expense	$170,000 25,000
Income tax Net income	34,000 73,000

From the balance sheet:

Current liabilities	$95,000
Long-term debt	560,000
Deferred income taxes	28,000
Total Liabilities	$680,000
Preferred stock	7,000
Common stock	225,000
Premium on common stock	125,000
Retained earnings	445,000
Total Stockholders Equity	$802,000
Total Liabilities & Stockholders Equity	$1,482,000

What is the Times Interest Earned ratio? _________ /_______ = ___________

What is the Debt/Assets (Debt) ratio? ________________ /___________ = __________

What is the Debt*/Equity ratio? ________________ /___________ = __________

*Use Long-term debt

Consider the additional information for the above analysis:

a. Times Interest Earned, company prior year: 3.0 Industry average: 6.1

Interpret your findings: Are the results acceptable? Explain.

b. Debt /Equity ratio, company prior year: 0.3 Industry average: 0.5

Interpret your findings: Are the results acceptable? Explain.