Solvency Analysis The following information is available from the balance sheets at the ends of the two most recent years and the income statement for the most recent year of Impact Company: December 31 2017 2016 Accounts payable Accrued liabilities Taxes payable Short-term notes payable Bonds payable due within next year Total current liabilities Bonds payable Common stock, $10 par Retained earnings Total stockholders' equity Total liabilities and stockholders equity $ 65,000 $ 50,000 25,000 35,000 60,000 45,000 0 75,000 200,000 200,000 $ 350,000 $ 405,000 $ 600,000 $ 800,000 $1,000,000 $1,000,000 650,000 500,000 $1,650,000 $1,500,000 $2,600,000 $2,705,000 2017 Sales revenue Cost of goods sold Gross profit Selling and administrative expense Operating income Interest expense Income before tax Income tax expense $1,600,000 950,000 $ 650,000 300,000 $ 350,000 89,000 $ 261,000 111,000 $ 150,000 Net Income Other Information: a. Short-term notes payable represents a 12-month loan that matured in November 2017. Interest of 12% was paid at maturity. b. One million dollars of serial bonds had been issued ten years earlier. The first series of $200,000 matured at the end of 2017, with interest of 8% payable annually. c. Cash flow from operations was $185,000 in 2017. The amounts of interest and taxes paid during 2017 were $89,000 and $96,000, respectively. Required: 1. Compute the following for Impact Company. Round your answers to two decimal places. a. The debt-to-equity ratio at December 31, 2017, and December 3 b. The times interest earned ratio for 2017 c. The debt service coverage ratio for 2017 2017 2016 to 1 to 1 to 1 times