Refer to the following selected financial information from a company. Compute the company’s debt-to-equity ratio for Year 2. Year 2Year 1Net sales$ 484,500$ 427,450Cost of goods sold277,500251,320Interest expense10,90011,900Net income before tax68,45053,880Net income after tax47,25041,100Total assets319,500295,200Total liabilities175,400168,500Total equity144,100126,700Answer:A. 1.22.B. 1.82.C. 3.36.D. 0.82.E. 2.22.

Name: Refer to the following selected financial information from a company.
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Description: Refer to the following selected financial information from a company. Compute the company’s debt-to-equity ratio for Year 2. Year 2Year 1Net sales$ 484,500$ 427,450Cost of goods sold277,500251,320Interest expense10,90011,900Net income before tax68,4

The debt to equity ratio is calculated as total liabilities divided by total shareholder's equity.

Answered: Refer to the following selected…

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

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Problem 18BEA

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Refer to the following selected financial information from a company. Compute the company’s debt-to-equity ratio for Year 2.

	Year 2	Year 1
Net sales	$ 484,500	$ 427,450
Cost of goods sold	277,500	251,320
Interest expense	10,900	11,900
Net income before tax	68,450	53,880
Net income after tax	47,250	41,100
Total assets	319,500	295,200
Total liabilities	175,400	168,500
Total equity	144,100	126,700

Answer:

A. 1.22.

B. 1.82.

C. 3.36.

D. 0.82.

E. 2.22.

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