p 7-9 Allen Company and Barker Company are competitors in the same industry. Selecte financial data from their 2011 statements follow. Balance Sheet December 31, 2011 Barker Company 35,000 120,000 190,000 100,000 20,000 520,000 $985,000 Allen Company Cash Accounts receivable Inventory Investments Intangibles Property, plant, and equipment 10,000 45,000 70,000 40,000 11,000 180,000 $356,000 Total assets ng-Term Debt-Paying Ability (P 7-9 coNTINUED) Allen Company Barker Accounts payable Bonds payable Preferred stock, $1 par Common stock, $10 par Retained earnings 60,000 100,000 50,000 100,000 46,000 $356,000 $165,000 410,000 30,000 280,000 100,000 $985,000 Total liabilities and capital ncome Statement For the Year Ended December 31, 2011 Allen Company Barker Company Sales Cost of goods sold Selling and administrative expenses Interest expense Income taxes Net income $1,050,000 725,000 230,000 10,000 42,000 $ 43,000 $2,800,000 2,050,000 580,000 32,000 65,000 S 73.000 Industry Averages: Times interest earned Debt ratic Debt/equity Debt to tangible net worth 7.2 times 40.3% 66.6% 72.7% Required Compute the following ratios for each company: 1. Times interest earned 2. Debt ratio 3. Debt/equity ratio 4. Debt to tangible net worth a. Which company has the better long-term debt position? Explain. to take on additional long-term debt? Explain c