Ratio of Liabilities to Stockholders' Equity and Times Interest EarnedHasbro, Inc. and Mattel, Inc. are the two largest toy companies in North America. Condensed liabilities and stockholders' equity from a recent balance sheet are shown for each company as follows (in thousands): HasbroMattelLiabilities: Current liabilities$1,951,000 $3,482,000 Long-term debt1,050,200 1,382,000 Other liabilities_ 663,600 Total liabilities$3,001,200 $5,527,600 Shareholders' equity: Common stock$170,000 $765,000 Additional paid in capital525,000 2,806,000 Retained earnings3,269,000 2,892,000 Accumulated other comprehensive income (loss) and other equity items38,000 (468,000) Treasury stock, at cost(1,501,000) (1,743,000) Total stockholders' equity$2,501,000 $4,252,000 Total liabilities and stockholders' equity$5,502,200 $9,779,600 The income from operations and interest expense from the income statement for both companies were as follows (in thousands): HasbroMattelIncome from operations (before income tax)$644,100 $1,714,000 Interest expense57,000 171,400 a. Determine the ratio of liabilities to stockholders' equity for both companies. Round to one decimal place.Hasbro, Inc.fill in the blank 1Mattel, Inc.fill in the blank 2b. Determine the times interest earned ratio for both companies. Round to one decimal place.Hasbro, Inc.fill in the blank 3Mattel, Inc.fill in the blank 4

Answered: . Determine the ratio of liabilities…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 13E: Ratio of liabilities to stockholders equity and times interest earned The following data were taken...

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Ratio of Liabilities to Stockholders' Equity and Times Interest Earned

Hasbro, Inc. and Mattel, Inc. are the two largest toy companies in North America. Condensed liabilities and stockholders' equity from a recent balance sheet are shown for each company as follows (in thousands):

	Hasbro	Mattel
Liabilities:
Current liabilities	$1,951,000		$3,482,000
Long-term debt	1,050,200		1,382,000
Other liabilities	_		663,600
	Total liabilities	$3,001,200		$5,527,600
Shareholders' equity:
	Common stock	$170,000		$765,000
	Additional paid in capital	525,000		2,806,000
	Retained earnings	3,269,000		2,892,000
	Accumulated other comprehensive
	income (loss) and other equity items	38,000		(468,000)
Treasury stock, at cost	(1,501,000)		(1,743,000)
Total stockholders' equity	$2,501,000		$4,252,000
Total liabilities and stockholders' equity	$5,502,200		$9,779,600

The income from operations and interest expense from the income statement for both companies were as follows (in thousands):

	Hasbro	Mattel
Income from operations (before income tax)	$644,100		$1,714,000
Interest expense	57,000		171,400

a. Determine the ratio of liabilities to stockholders' equity for both companies. Round to one decimal place.

Hasbro, Inc.	fill in the blank 1
Mattel, Inc.	fill in the blank 2

b. Determine the times interest earned ratio for both companies. Round to one decimal place.

Hasbro, Inc.	fill in the blank 3
Mattel, Inc.	fill in the blank 4

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