Please answer the below question/problem ASAP for MBA 560 Financial and Managerial Accouting.

	Jona, Inc.
	Balance Sheets (Adapted)
	December 31, 2012 and 2011
					Increase (Decrease)
(Dollar amounts in millions)			2012	2011	Amount	Percentage
Assets
		Current Assets
		Cash and cash equivalents	$398	$310	$88	28.4	%
		Short-term investments	20	40	(20)	(50.0)
		Receivables, net	250	264	(14)	(5.3)
		Inventories	100	86	14	16.3
		Prepaid expenses and other assets	254	312	(58)	(18.6)
		Total current assets	1,022	1,012	10	1.0
		Property, plant, and equipment, net	3,680	3,336	344	10.3
		Intangible assets	1,050	818	232	28.4
		Other assets	818	726	92	12.7
		Total assets	$6,570	$5,892	$678	11.5	%

	Jona, Inc.
	Balance Sheets (Adapted)
	December 31, 2012 and 2011
					Increase (Decrease)
(Dollar amounts in millions)			2012	2011	Amount	Percentage
Liabilities and Stockholders' Equity
		Current Liabilities
		Accounts payable	$1,306	$1,206	$100	8.3	%
		Income tax payable	34	70	(36)	(51.4)
		Short-term debt	230	220	10	4.5
		Other	68	70	(2)	(2.9)
		Total current liabilities	1,638	1,566	72	4.6
		Long-term debt	2,406	1,756	650	37.0
		Other liabilities	1,158	1,066	92	8.6
		Total liabilities	5,202	4,388	814	18.6
		Stockholders' Equity
		Common stock	2	2
		Retained earnings	1,532	1,690	(158)	(9.3)
		Accumulated other comprehensive (loss)	(166)	(188)	22	11.7
		Total stockholders' equity	1,368	1,504	(136)	(9.0)
		Total liabilities and stockholders' equity	$6,570	$5,892	$678	11.5	%

Data Table

	Jona, Inc.
	Statements of Income (Adapted)
	Year Ended December 31, 2012 and 2011
		(Dollar amounts in millions)	2012	2011
		Revenues	$9,501	$9,319
		Expenses:
		Food and paper (Cost of goods sold)	2,529	2,624
		Payroll and employee benefits	2,139	2,181
		Occupancy and other operating expenses	2,443	2,365
		General and administrative expenses	1,207	1,098
		Interest expense	184	147
		Other expense (income), net	19	(36)
		Income before income taxes	980	940
		Income tax expense	286	269
		Net income	$694	$671

The financial statements of Jona, Inc., follow:

.
1.	Compute the company's debt ratio at December 31, 2012.
	2. Compute the company's times-interest-earned ratio for 2012. For operating income, use income before both interest expense and income taxes. You can simply add interest expense back to income before taxes.
3.	Is Jonas lability to pay liabilities and interest expense strong or weak? Comment on the value of each ratio computed for questions 1 and 2.

Select the formula and then enter the amounts to calculate the debt ratio. (Enter amounts in million. Round your answer to three decimal places.)

					/		=	Debt ratio
					/		=

2. Compute the company's times-interest-earned ratio for 2012.

For operating income, use income before both interest expense and income taxes. You can simply add interest expense back to income before taxes. (Enter amounts in million. Round your answer to one decimal place.)

		/		=	Times-interest-earned ratio
		/		=

3. Is Jona's ability to pay liabilities and interest expense strong or weak? Comment on the value of each ratio computed for requirements 1 and 2.

The debt ratio is

high

low

.

The times-interest earned ratio is

high

low

.

Overall the company's ability to pay its liabilities and interest expense looks

bad

good

mixed

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