Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
5th Edition
ISBN: 9780134078939
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 11, Problem 10QC
To determine
Times-Interest-Earned ratio: It is the ratio that quantify a business ability to pay interest expense. It is calculated as shown below:
To identify: The correct answer by solving times-interest earned ratio for the MD Associates for 2016.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
K
McDaniel and Associates, Inc. reported the following amounts on its 2024 income statement:
Year Ended
December 31, 2024
Net income
Income tax expense
Interest expense
$
22,950
6,600
3,000
What was McDaniel's times-interest-earned ratio for 2024?
OA. 7.65
OB. 10.85
OC. 9.85
OD. 8.65
point(s) possible
...
The 2017 annual report of Tootsie Roll Industries contains the following information.
(in millions)
December 31, 2017
0000
December 31, 2016
Total assets
$930.9
$920.1
Total liabilities
197.1
208.6
Net sales
515.7
517.4
Net income
80.7
67.2
Instructions
Compute the following ratios for Tootsie Roll for 2017.
a. Asset turnover.
b. Return on assets.
c. Profit margin on sales.
d. How can the asset turnover be used to compute the return on assets?
Crane Company's 2025 financial statements contain the following selected data:
Income taxes
Interest expense
Net income
$43000
20000
3.1 times.
6.2 times.
5.2 times.
4.1 times.
61000
Crane's times interest earned for 2025 is
Chapter 11 Solutions
Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
Ch. 11 - Prob. 1QCCh. 11 - On January 1, 2016, a business borrowed 18,000 on...Ch. 11 - A company sells 180,000 (selling price) of goods...Ch. 11 - Prob. 4QCCh. 11 - Prob. 5QCCh. 11 - Prob. 6QCCh. 11 - Prob. 7QCCh. 11 - Vega Company expects to pay a 4% bonus on net...Ch. 11 - Prob. 9QCCh. 11 - Prob. 10QC
Ch. 11 - Prob. 1RQCh. 11 - What is a current liability? Provide some examples...Ch. 11 - How is sales tax recorded? Is it considered an...Ch. 11 - How do unearned revenues arise?Ch. 11 - What do short-term notes payable represent?Ch. 11 - Coltrane Company has a 5,000 note payable that is...Ch. 11 - Prob. 7RQCh. 11 - Prob. 8RQCh. 11 - Prob. 9RQCh. 11 - Prob. 10RQCh. 11 - What are the two main controls for payroll?...Ch. 11 - When do businesses record warranty expense, and...Ch. 11 - Prob. 13RQCh. 11 - Prob. 14RQCh. 11 - Prob. 15RQCh. 11 - Determining current versus long-term liabilities...Ch. 11 - Prob. 11.2SECh. 11 - Prob. 11.3SECh. 11 - Accounting for a note payable On December 31,...Ch. 11 - Prob. 11.5SECh. 11 - Prob. 11.6SECh. 11 - Computing payroll amounts considering FICA tax...Ch. 11 - Prob. 11.8SECh. 11 - Prob. 11.9SECh. 11 - Prob. 11.10SECh. 11 - Prob. 11.11SECh. 11 - Accounting treatment for contingencies Fernandez...Ch. 11 - Prob. 11.13SECh. 11 - Recording sales tax Consider the following...Ch. 11 - Prob. 11.15ECh. 11 - Recording and reporting current liabilities...Ch. 11 - Journalizing current liabilities Erik OHern...Ch. 11 - Prob. 11.18ECh. 11 - Recording employer payroll taxes and employee...Ch. 11 - Prob. 11.20ECh. 11 - Prob. 11.21ECh. 11 - Prob. 11.22ECh. 11 - Prob. 11.23ECh. 11 - Prob. 11.24ECh. 11 - Prob. 11.25APCh. 11 - Prob. 11.26APCh. 11 - Journalizing liability transactions T he following...Ch. 11 - Journalizing liability transactions The following...Ch. 11 - Prob. 11.29APCh. 11 - Prob. 11.30BPCh. 11 - Prob. 11.31BPCh. 11 - Prob. 11.32BPCh. 11 - Prob. 11.33BPCh. 11 - Prob. 11.34BPCh. 11 - Prob. 11.35CPCh. 11 - Prob. 11.1CTDCCh. 11 - Sell-Soft is the defendant in numerous lawsuits...Ch. 11 - Prob. 11.1CTEICh. 11 - Derails about a company's liabilities appear in a...Ch. 11 - Prob. 11.1CTCA
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Find the number of times interest earned in 2021:arrow_forwardPlease givearrow_forwardIncome Statement Bullseye, Incorporated's 2018 income statement lists the following income and expenses: EBIT = $906,500, Interest expense = $85,000, and Net income = $579,000. What is the 2008 Taxes reported on the income statement?arrow_forward
- Given the historical income statement of Mega Trade Inc., how much would be added to the company's retained earning for the year 2016 (in millions)? Income Statement ( $ Million) Year End 2015 2016 2017 2019 Sales 1, 234.90 1,251.70 1,300.40 1,334.40 Cost of Sales -679.1 -659 -681.3 -667 Gross Operating Income Selling & Administration -339.7 -348.6 -351.2 -373.3 Depreciation -47.5 -52 -55.9 -75.2 Other Income / Expenses 11.8 7.6 7 8.2 Earnings Before Interest and Taxes Interest Income 1.3 1.4 1.7 2 Interest Expense -16.2 -15.1 -20.5 -23.7 Pre Tax Income Income Taxes -56.8 -64.2 -67.5 -72.6 Net Income Dividends -38.3 -38.7 -39.8 -40.1arrow_forwardComputing rate of return on total assets Barot’s 2018 financial statements reported the following items—with 2017 figures given for comparison: Net income for 2018 was $3,910, and interest expense was $240. Compute Barot’s rate of return on total assets for 2018. (Round to the nearest percent.)arrow_forwardUse the following tables to answer the question: LOGIC COMPANY Income Statement For years ended December 31, 2016 and 2017 (values in $) 2016 2017 Gross sales 19,800 15,600 Sales returns and allowances 900 100 Net sales 18,900 15,500 COGS 11,800 8,800 Gross profit 7,100 6,700 Depreciation 780 640 Selling and administrative expenses 2,800 2,400 Research 630 540 Miscellaneous 440 340 Total operating expenses 4,650 3,920 Income before interest and taxes 2,450 2,780 Interest expense 640 540 Income before taxes 1,810 2,240 Provision for taxes 724 896 LOGIC COMPANY Balance Sheet For years ended December 31, 2016 and 2017 (values in $) 2016 2017 Current assets 12,300 9,400 Accounts receivable 16,900 12,900 Merchandise inventory 8,900 14,400 Prepaid expenses 24,400 10,400 Total current assets 62,500 47,100 Building (net) 14,900 11,400 Land 13,900 9,400 Total plant and equipment 28,800 20,800 Total assets 91,300 67,900 Accounts payable 13,400 7,400 Salaries payable 7,500 5,400 Total current…arrow_forward
- Selected income statement data follow for Harper, Inc., for the year ended December 31 (in thousands). What is the company's times interest earned ratio? Operating income before interest Interest expense Operating income after interest Income tax Income after tax 35.6 30.6 11.2 24.4 6,617 189 6.428 1,607 4,821arrow_forwardGiven the historical income statement of Mega Trade Inc., how much would be added to the company's retained earning for the year 2016 (in millions)? Income Statement ($ Million) Income Statement ( $ Million) Year End 2015 2016 2017 2019 Sales 1, 234,90 1,251.40 1,300.40 1,334.40 Cost of Sales -679.1 -659 -681.3 -667 Gross Operating Income Selling & Administration -339.7 -348.6 -351.2 -373.3 Depreciation -47.5 -52 -55.9 -75.2 Other Income / Expenses 11.8 7.6 7 8.2 Earnings Before Interest and Taxes Interest Income 1.3 1.4 1.7 2 Interest Expense -16.2 -15.1 -20.5 -23.7 Pre Tax Income Income Taxes -56.8 -64.2 -67.5 -72.6 Net Income Dividends -38.3 -38.7 -39.8 -40.1arrow_forwardCalculating trend analysis Muscateer Corp reported the following revenues and net income amounts: Requirements Calculate Muscateer’s trend analysis for revenues and net income Use 2016 as the base year and round to the nearest percent. Which measure increased at a higher rate during 2017-2019?arrow_forward
- Using the information below calculate the ROC of the company Years Revenue ($M) Net Income ($M) 2012 221.8 2.9 2013 473.8 20.2 2014 627.7 36.4 2015 947.8 45.0 2016 1,015.5 50.3 2017 1,046.2 64.9 2018 1,293.2 90.4 Years Total Assets ($M) Fixed Assets ($M) Current Assets ($M) Total Equity ($M) Retained Earnings ($M) 2012 430 286 144 293 12.8 2013 956 501 455 558 33.0 2014 922 668 324 620 69.4 2015 1103 796 307 665 114.4 2016 1120 835 285 729 164.7 2017 1294 738 556 805 229.6 2018 2053 703 1350 934 320arrow_forwardanswer quicklyarrow_forwardBauman Company's total current assets, total current liabilities, and inventory for each of the past4 years follow:Item 2016 2017 2018 2019Total current assets $17,230 $21,720 $22,390 $26,190Total current liabilities 8,860 12,370 13,560 17,120Inventory 5,650 6,930 7,340 7,560a. Calculate the firm's current and quick ratios for each year. Compare the resulting time series for these measures ofliquidity.b. Comment on the firm's liquidity over the 2016-2019 period.c. If you were told that Bauman Company's inventory turnover for each year in the - period and the industryaverages were as follows, would this information support or conflict with your evaluation in part (b).? Why?2016 2019Item 2016 2017 2018 2019Bauman Company 6.3 6.8 7.0 6.4Industry Average 11.4 12.0 11.6 11.8arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT
Financial ratio analysis; Author: The Finance Storyteller;https://www.youtube.com/watch?v=MTq7HuvoGck;License: Standard Youtube License