At the end of the current year, the following information is available for both Pulaski Company and Scott Company. Pulaski Company Scott Company Total assets $ 2,287,500 $ 1,156,500 Total liabilities 871,500 565,500 Total equity 1,416,000 591,000 1. Compute the debt-to-equity ratios for both companies. 2. Which company has the riskier financing structure?
At the end of the current year, the following information is available for both Pulaski Company and Scott Company. Pulaski Company Scott Company Total assets $ 2,287,500 $ 1,156,500 Total liabilities 871,500 565,500 Total equity 1,416,000 591,000 1. Compute the debt-to-equity ratios for both companies. 2. Which company has the riskier financing structure?
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 50E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...
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At the end of the current year, the following information is available for both Pulaski Company and Scott Company.
| Pulaski Company | Scott Company | |||||
| Total assets | $ | 2,287,500 | $ | 1,156,500 | ||
| Total liabilities | 871,500 | 565,500 | ||||
| Total equity | 1,416,000 | 591,000 | ||||
1. Compute the debt-to-equity ratios for both companies.
2. Which company has the riskier financing structure?
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