Managerial Accounting
7th Edition
ISBN: 9781260247886
Author: Wild
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 13, Problem 10QS
To determine
Concept introduction:
Debt-to-equity ratio:
Debt-to-equity ratio is a measurement of long-term solvency of a company which shows relationship between total liabilities and total equity. This ratio tells that how much debts company is using in compare to total equity.
(a) Debt-to-equity ratio
(b) Times interest earned
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Given the following information, calculate the debt ratio percentage:
Liabilities = $24,500
Liquid assets = $4,900
Monthly credit payments = $800
Monthly savings = $760
Net worth = $72,500
Current liabilities = $1,600
Take-home pay = $2,300
Gross income = $3,500
Monthly expenses = $-2,040
Paddy's Pub reported the following year-end data:
Income before interest expense and income tax expense
Cost of goods sold
Interest expense
Total assets
Total liabilities
Total equity
Compute the (a) debt-to-equity ratio and (b) times Interest earned.
Complete this question by entering your answers in the tabs below.
Debt To Equity Times Interest
Ratio
Earned
Compute the debt-to-equity ratio.
Numerator:
1
1
Debt-To-Equity Ratio
Denominator:
II
Debt-to-Total-Assets RatioRuby Company’s balance sheet reports the following totals: Assets = $40,000; Liabilities = $25,000; Stockholders’ Equity = $15,000.
Determine the company’s debt-to-total-assets ratio.
Chapter 13 Solutions
Managerial Accounting
Ch. 13 - Prob. 1MCQCh. 13 - Prob. 2MCQCh. 13 - Prob. 3MCQCh. 13 - Prob. 4MCQCh. 13 - Prob. 5MCQCh. 13 - Prob. 1DQCh. 13 - Prob. 2DQCh. 13 - Prob. 3DQCh. 13 - Prob. 4DQCh. 13 - Prob. 5DQ
Ch. 13 - Prob. 6DQCh. 13 - Prob. 7DQCh. 13 - Prob. 8DQCh. 13 - Prob. 9DQCh. 13 - Prob. 10DQCh. 13 - Prob. 11DQCh. 13 - Prob. 12DQCh. 13 - Where on the income statement does a company...Ch. 13 - Prob. 14DQCh. 13 - Prob. 15DQCh. 13 - Samsung Refer to Samsung’s financial statements in...Ch. 13 - Prob. 17DQCh. 13 - Prob. 1QSCh. 13 - Prob. 2QSCh. 13 - Prob. 3QSCh. 13 - Prob. 4QSCh. 13 - Prob. 5QSCh. 13 - Prob. 6QSCh. 13 - Prob. 7QSCh. 13 - Prob. 8QSCh. 13 - Prob. 9QSCh. 13 - Prob. 10QSCh. 13 - Prob. 11QSCh. 13 - Prob. 12QSCh. 13 - Prob. 13QSCh. 13 - Morgan Company and Parker Company are similar...Ch. 13 - Which of the following gains or losses would...Ch. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Prob. 5ECh. 13 - Exercise 13-6 Common-size percents P2
Simon...Ch. 13 - Prob. 7ECh. 13 - Exercise 13-8 Liquidity analysis and...Ch. 13 - Exercise 13-9 Risk and Capital structure analysis...Ch. 13 - Exercise 13-10 Efficiency and Profitability...Ch. 13 - Exercise 13-11 profitability analysis P3 Refer to...Ch. 13 - Prob. 12ECh. 13 - Prob. 13ECh. 13 - Prob. 14ECh. 13 - Prob. 15ECh. 13 - Exercise Interpreting financial ratios Refer to...Ch. 13 - Prob. 17ECh. 13 - Prob. 18ECh. 13 - Prob. 1PSACh. 13 - Prob. 2PSACh. 13 - Prob. 3PSACh. 13 - Problem 13-4A Calculation of financial statement...Ch. 13 - Prob. 5PSACh. 13 - Prob. 6PSACh. 13 - Prob. 1PSBCh. 13 - Prob. 2PSBCh. 13 - Prob. 3PSBCh. 13 - Prob. 4PSBCh. 13 - Prob. 5PSBCh. 13 - Problem 13-6BAIncome statement computations and...Ch. 13 - Use the following selected data from Business...Ch. 13 - Use Apple’s financial statements in Appendix A to...Ch. 13 - Prob. 2AACh. 13 - Prob. 3AACh. 13 - Prob. 1BTNCh. 13 - Prob. 2BTNCh. 13 - Prob. 3BTNCh. 13 - Prob. 4BTNCh. 13 - ENTREPRENEURIAL DECISION A1 P1 P2 P3 BTN 13-7...Ch. 13 - Prob. 6BTN
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
- Klynveld Companys balance sheet shows total liabilities of 94,000,000, total stockholders equity of 75,000,000, and total assets of 169,000,000. Required: Note: Round answers to two decimal places. 1. Calculate the debt ratio. 2. Calculate the debt-to-equity ratio.arrow_forwardErnst Companys balance sheet shows total liabilities of 32,500,000, total stockholders equity of 8,125,000, and total assets of 40,625,000. Required: Note: Round answers to two decimal places. 1. Calculate the debt ratio. 2. Calculate the debt-to-equity ratio.arrow_forwardTotal Debt = 800,000; Income before Income Taxes and Interest Expense = 100,000; Total Assets = 1,000,000. How much is the Debt to Total Assets Ratio?arrow_forward
- Calculate the debt-to-equity ratio. Total asset = $1,500,000 Total debts = $1,200,000 Current liabilities = $600,000arrow_forwardRatio Analysis Presented below are summary financial data from Porter's annual report: Amounts in millions Balance Sheet Cash and Cash Equivalents Marketable Securities Accounts Receivable (net) Total Current Assets Total Assets Current Liabilities Long-Term Debt- Shareholders' Equity Income Statement Interest Expense Net Income Before Taxes b. Quick ratio $1,850 19,100 9,367 39,088 123,078 38,450 7,279 68,278 Calculate the following ratios: (Round to 2 decimal points) a. Times-interest-earned ratio c. Current ratio 400 14,007arrow_forwardGiven the following information, calculate the debt ratio percentage: Liabilities $24,000 Liquid assets $4,400 Monthly credit payments $300 Monthly savings $260 Net worth $72,000 Current liabilities $1,100 Take-home pay $1,800 Gross income $3,000 Monthly expenses $1,540 a) 33.3 b) 4 c) 2.86 O d) 16.67 O e) 8.67arrow_forward
- Rosewood Company had current assets of $612, current liabilities of $393, total assets of $722. and long-term liabilities of $200. What is Rosewood's debt ratio? (Round your final answer to two decimal places.) 1.56 0.54 O0.82 0.28arrow_forwardBased on the following information as of December 31,2020, compute the company’s debt-equity ratio. Assume current liabilities are all interest-bearing. Round to nearest two decimal places. Current assets: 15 Non-current assets: 12 Current Liabilities: 22 Non-current Liabilities: 4 Debt to Equity Ratio = ?arrow_forwardSuppose the Crane Ltd's 2020 financial statements contain the following selected data (in millions). Current assets Total assets Current liabilities Total liabilities NT$3,536.0 31,408.0 3,016.0 16,640.0 Compute the following values. Interest expense Income taxes Net income NT$520.0 (a) Debt to assets ratio. (Round to O decimal places, e.g. 62%.) 1,976.0 4,590.0 (b) Times interest earned. (Round to 2 decimal places, e.g. 6.25.) % timesarrow_forward
- Whitten Corporation's balance sheet shows the following amounts: current assets, $200,000; current liabilities, $80,000; bonds payable, $155,000; and lease obligations, $25,000. Total stockholders' equity is $120,000. Calculate the debt to equity ratio. Round your answer to two decimal placesarrow_forwardReview of the financial statements revealed the following for Cullumber Inc.: sales $1256000, net income $43700, total assets $653120, long- term debt $761000, interest expense $65312 and cost of goods sold $781000. When preparing common- size financial statements, interest expense would be shown as a) 10.0% b) 9.2%. c) 8.4%. d) 5.2%.arrow_forwardThe following data are taken from the balance sheet at the end of the current year. Determine the (a) working capital, (b) current ratio, and (c) quick/acid-test ratio. Present figures used in your computations. Round ratios to the nearest tenth. Accounts payable $145,000 Accounts receivable 110,000 Accrued liabilities 4,000 Cash 80,000 Income tax payable 10,000 Inventory 140,000 Marketable securities 250,000 Notes payable, short-term 85,000 Prepaid expenses 15,000 ANSWERS: (a) (b) (c)arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Financial ratio analysis; Author: The Finance Storyteller;https://www.youtube.com/watch?v=MTq7HuvoGck;License: Standard Youtube License