The accounting records of Braintree $$Foods$,$ Inc., include the following items at December$31,2021$:

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Part $1$

Requirement $1.$ Show how each relevant item would be reported on the Braintree Foods classified balance sheet. Include headings and totals for current liabilities and$$ long$-$term liabilities.

Select the labels and then enter the amounts to complete the classified balance sheet. You will need to determine the total current assets value from the information provided and your calculations. $($Abbreviations used: liab.$=$ liabilities, NP$=$ notes$$ payable, and pay.$=$ payable.$)$

Braintree Foods, Inc.

Partial Balance Sheet

December $31,2021$

Assets

Liabilities

Less:

Less:

Part $2$

Requirement $2.$ Answer the following questions about Braintree $$Food$\text{'}$s financial position at December$31,2021$:

a$.$

What is the carrying amount of the bonds payable $($combine the current and long$-$term accounts$)?$

Part $3$

b$.$ Why is the interest payable amount so much less than the amount of interest$$ expense?

Interest payable is the

$$

amount of interest that the company owes at year$-$end.

company's cost of borrowing for the full year.

Interest expense is the

$$

amount of interest that the company owes at year$-$end.

company's cost of borrowing for the full year.

Part $4$

Requirement $3.$ How many times did Braintree Foods cover its interest expense during $2021?($Round your answer to two decimal$$ places.$)$

Braintree covered its interest expense

times.

Part $5$

Requirement $4.$ Assume that all of the existing liabilities are included in the information provided. Calculate the leverage ratio and debt ratio of the company. Use$$ year$-$end figures in place of averages where needed for the purpose of calculating ratios in this problem. Evaluate the health of the company from a leverage point of view. Assume the company only has common stock issued and outstanding. What other information would be helpful in making your$$ evaluation?

Begin by computing the leverage ratio. Select the formula for the leverage ratio. Then complete the formula and calculate the leverage ratio. $($Round your answer to two decimal$$ places.$)$

Part $6$

$-$:

$=$

Leverage ratio

$-$:

$=$

Part $7$

$$Now$,$ select the formula for the debt ratio. Then complete the formula and calculate the debt ratio. $($Round your answer to two decimal$$ places.$)$

Part $8$

$-$:

$=$

Debt ratio

$-$:

$=$

Part $9$

Evaluate the health of the company from a leverage point of view. What other information would be helpful in making your$$ evaluation? $($Round the ratio to two decimal$$ places.$)$

The company's debt ratio and leverage ratios are

$,$ and operating income covers interest payments by

times.

With this limited information, the company appears to be

risk from a leverage point of view.

would also be helpful.

Mortgage note payable,

Total assets

$$4,600,000$

current portion

$$95,000$

Accumulated depreciation,

Leases payable $($long$-$term$)$

$460,000$

equipment

$164,000$

Bonds payable, long$-$term

$325,000$

Discount on bonds payable

Mortgage note payable

$($all long$-$term$)$

$25,000$

long$-$term

$316,000$

Operating income

$370,000$

Bonds payable, current portion

$50,000$

Equipment

$744,000$

Interest expense

$223,000$

Long$-$term investments

$($market value$)$

$430,000$

Interest payable

$77,000$