Kahluha Manufacturers Inc. reported the following information in its financial statements (10marks)

KAHLUHA MANFACTURERS INC.

Statement of Financial Position

June 30

Assets ......................... 2023 2022

Cash ......................... $32,000 $29,000

Accounts receivable ......................... 7,500 5,500

Prepaid Insurance ......................... 1,100 1,450

Inventory ......................... 220,000 175,000

Building ......................... 145,000 155,000

Equipment ......................... 36,000 40,000

Total Assets ......................... $441,600 $405,950

Liabilities and shareholders equity

Accounts Payable ......................... $ 12,500 $14,500

Notes Payable ......................... 10,000 0

Bonds Payable ......................... 145,000 95,000

Long-Term Debt ......................... 116,000 175,000

Common shares ......................... 25,000 25,000

Retained earnings ......................... 133,100 96,450

Total liabilities and shareholders equity ......................... $441,600 $405,950

Revenue ......................... $450,000 $300,000

Operating expenses ......................... 300,000 210,000

Income from operations ......................... 150,000 90,000

Interest expense ......................... 6,000 9,000

Income tax expense ......................... 36,000 20,250

Net income ......................... $108,000 $60,750

Instructions

(a) Calculate the companys debt to total assets and times interest earned ratios for each year.(8 marks)

(b) Determine if the change from 2022- 2023 is an improvement or deterioration. (2 marks)