Ratio of Liabilities to Stockholders' Equity and Times Interest Earned The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years:   Current Year Previous Year Accounts payable $698,000   $212,000   Current maturities of serial bonds payable 460,000   460,000   Serial bonds payable, 10% 1,920,000   2,380,000   Common stock, $1 par value 100,000   130,000   Paid-in capital in excess of par 1,130,000   1,130,000   Retained earnings 3,900,000   3,100,000   The income before income tax expense was $714,000 and $624,800 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 year fill in the blank 1 Previous year fill in the blank 2 b.  Determine the times interest earned ratio for both years. Round to one decimal place. Current year fill in the blank 3 Previous year fill in the blank 4

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Ratio of Liabilities to Stockholders' Equity and Times Interest Earned

The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years:

  Current
Year
Previous
Year
Accounts payable $698,000   $212,000  
Current maturities of serial bonds payable 460,000   460,000  
Serial bonds payable, 10% 1,920,000   2,380,000  
Common stock, $1 par value 100,000   130,000  
Paid-in capital in excess of par 1,130,000   1,130,000  
Retained earnings 3,900,000   3,100,000  

The income before income tax expense was $714,000 and $624,800 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 year fill in the blank 1
Previous year fill in the blank 2

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

Current year fill in the blank 3
Previous year fill in the blank 4
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