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The following information pertains to Austin, Inc. and Huston Company: Account Title Current assets Total assets Current liabilities Total liabilities Stockholders' equity Interest expense Income
The following information pertains to Austin, Inc. and Huston Company: Account Title Current assets Total assets Current liabilities Total liabilities Stockholders' equity Interest expense Income tax expense Net income Austin $ 60,000 380,000 21,000 240,000 140,000 14,800 29,600 60,000 Huston $ 50,000 380,000 25,000 300,000 80,000 17,400 27,800 59,200 Required a-1. Compute each company's debt-to-assets ratio, current ratio, and times interest earned (EBIT must be computed). (Round your "Debt-to-assets ratio" and "Times interest earned" to 1 decimal place and current ratio answers to 2 decimal places.) Austin Huston Debt-to-assets ratio % % Current ratio to 1.00 to 1.00 Times interest earned times times a-2. Which company has the greater financial risk? Debt-to-assets ratio Current ratio Times interest earned
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