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Ratio of liabilities to stockholders' equity and times interest earned The following data were taken from the financial statements of Hunter Inc. for December 3
Ratio of liabilities to stockholders' equity and times interest earned
The following data were taken from the financial statements of Hunter Inc. for December of two recent years:
The income before income tax expense was $ and $ for the current and previous years, respectively.
a Determine the ratio of liabilities to stockholders' equity at the end of each year. Round your answers to one decimal place.
Current year
Previous year
b Determine the times interest earned ratio for both years. Round your answers to one decimal place.
Current year
Previous year
c The ratio of liabilities to stockholders' equity has
and the number of times bond interest charges were earned has
from the
previous year. These results are the combined result of
income before income taxes and
interest expense in the current year
compared to the previous year.
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