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Please help,I am having trouble calculating these. AGF Foods Company is a large, primarily domestic, consumer foods company involved in the manufacture, distribution, and sale
Please help,I am having trouble calculating these.
AGF Foods Company is a large, primarily domestic, consumer foods company involved in the manufacture, distribution, and sale of a variety of food products. Industry averages are derived from Troy's The Almanac of Business and Industrial Financial Ratios. Following are the 2016 and 2015 comparative income statements and balance sheets for AGF. (The financial data we use are from actual financial statements of a well-known corporation, but the company name is fictitious and the numbers and dates have been modified slightly to disguise the company's identity.) AGF FOODS COMPANY Years Ended December 31, 2016 and 2015 ($ in millions) Comparative Income Statements 2016 2015 Net sales $6,440 $5,800 Cost of goods sold (3,667) (3,389) 2,773 2,411 (1,916) (1,629) Gross profit Operating expenses Operating income 857 782 Interest expense (54) (53) Income from operations before tax 803 729 Income taxes (316) (287) Net income $ 487 $ 442 Comparative Balance Sheets Assets Total current assets Property, Plant, and Equipment (net) Intangibles (net) Other assets Total assets $1,879 $1,490 2,592 2,291 800 843 74 60 $5,345 $4,684 Liabilities and Shareholders' Equity Total current liabilities $1,473 $ 941 Long-term debt 534 728 Deferred income taxes 407 344 2,414 2,013 180 180 Total liabilities Shareholders' equity: Common stock Additional paid-in capital 21 63 Retained earnings 2,730 2,428 Total shareholders' equity 2,931 2,671 Total liabilities and shareholders' equity $5,345 $4,684 Long-term solvency refers to a company's ability to pay its long-term obligations. Financing ratios provide investors and creditors with an indication of this element of risk. Required: Calculate the debt to equity ratio for AGF for 2016. The average ratio for the stocks listed on the New York Stock Exchange in a comparable tim period was 1.0. What information does your calculation provide an investor? Is AGF experiencing favorable or unfavorable financial leverage? Calculate AGF's times interest earned ratio for 2016. The coverage for the stocks listed on the New York Stock Exchange in a comparable time period was 5.1. What does your calculation indicate about AGF's risk
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