Question
XYZ Ltd wants to assess its solvency position using various ratios. The following information is available: Total Assets: $500,000 Total Liabilities: $200,000 Equity: $300,000 EBIT:
XYZ Ltd wants to assess its solvency position using various ratios. The following information is available:
- Total Assets: $500,000
- Total Liabilities: $200,000
- Equity: $300,000
- EBIT: $150,000
- Interest Expense: $20,000
Calculate the following solvency ratios: a) Debt Ratio b) Debt-to-Equity Ratio c) Interest Coverage Ratio
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Financial Accounting The Impact on Decision Makers
Authors: Gary A. Porter, Curtis L. Norton
9th edition
130565417X, 1305654174, 9781285972572 , 978-1285182964
