Leland Industries Figure 1 Bond ratings of comparative firms International Bakeries Bond price Debt to total assets 30% Times interest earned 7.1X Annual interest $1,100 10.35% Fixed charge coverage 5.0X Maturity 25 years Current ratio 3.1X Par value $1,000 Return on stockholders' equity 22% (principal payment) Rating AA1 Gates Bakeries Debt to total assets 42% Bond price Times interest earned 5.5X Annual interest $920 9.45% Fixed charge coverage 4.2X Maturity 20 years Current ratio 2.3X Par value $1,000 Return on stockholders' equity 17.1% (principal payment) Rating A1 Savanah Products Debt to total assets 65% Times interest earned 2.0X Fixed charge coverage 1.7X Maturity Current ratio 1.2X Return on stockholders' equity 7% Bond price Annual interest Par value (principal payment) $1,150 15.75% 15 years $1,000 Rating B3 Dyer Pastries Debt to total assets 35% Times interest earned 6.0X Bond price Annual interest Fixed charge coverage 3.6X Maturity Current ratio 2.8X Par value $1,060 10.30% 20 years $1,000 Return on stockholders' equity 19% (principal payment) Rating AA3 Nolan Bread Debt to total assets 47% Times interest earned 4.9X Fixed charge coverage 3.8X Bond price Annual interest Maturity Current ratio 2.1X Par value Return on stockholders' equity 15% (principal payment) $950 10.30% 25 years $1,000 Rating A2