Question
The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: Current YearPrevious Year Accounts payable$410,000$250,000Current maturities
The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years:
Current YearPrevious YearAccounts payable$410,000$250,000Current maturities of serial bonds payable420,000420,000Serial bonds payable, 10%1,970,0002,390,000Common stock, $1 par value80,000110,000Paid-in capital in excess of par880,000880,000Retained earnings3,040,0002,410,000
The income before income tax was $621,400 and $543,700 for the current and previous years, respectively.
a.Determine the ratio of liabilities to stockholders' equity at the end of each year. Round to one decimal place.
Current yearPrevious year
b.Determine the times interest earned ratio for both years. Round to one decimal place.
Current yearPrevious year
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