MANAGERIAL ACCOUNTING ACCT 2302 >IC<
5th Edition
ISBN: 9781259690440
Author: Wild
Publisher: MCG CUSTOM
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 13, Problem 9E
To determine
(1)
Introduction:
Debt and equity ratio measures the proportion of debt and equity that a company has as a part of its capital structure.
To calculate:
Debt and equity ratio.
To determine
(2)
Introduction:
Debt-equity ratio measures the proportion of debt and equity in the capital structure.
To calculate:
Debt to equity ratio.
To determine
(3)
Introduction:
Time interest earned ratio measures the amount of income that will be required for covering the interest expenses in the future.
To calculate:
Time interest earned.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Refer to the information in Exercises 1–3 and 1–5 about Mixon Company. Compare the long-term risk and capital structure positions of the company at the end of 2006 and 2005 by computing the following ratios: (a) total debt ratio and (b) times interest earned. Comment on these ratio results.
Using the data in exhibits C2.1 and C2.3, calculate and analyze the firm’s 2012 and 2013 ratios. Enter the ratios in the table below in the 2012 and 2013 columns, respectively:
Ratio Type
2012
2013
Current (times)
3.40
3.43
Quick (times)
2.18
1.83
Debt (%)
Times interest earned (times)
Inventory turnover (times)
Total asset turnover (times)
Average collections period (days)
Return on equity (%)
Using the data in exhibits C2.1 and C2.3, calculate and analyze the firm’s 2012 and 2013 ratios. Enter the ratios in the table below in the 2012 and 2013 columns, respectively:
Total asset turnover (times)
Average collections period (days)
Return on equity (%)
Chapter 13 Solutions
MANAGERIAL ACCOUNTING ACCT 2302 >IC<
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 - Prob. 16DQCh. 13 - Use Samsungs financial statements in Appendix A to...Ch. 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. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Prob. 5ECh. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Prob. 8ECh. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Prob. 11ECh. 13 - Prob. 12ECh. 13 - Prob. 13ECh. 13 - Prob. 14ECh. 13 - Prob. 15ECh. 13 - Prob. 1PSACh. 13 - Prob. 2PSACh. 13 - Prob. 3PSACh. 13 - Selected year-end and financial statement of...Ch. 13 - Prob. 5PSACh. 13 - Prob. 6PSACh. 13 - Prob. 1PSBCh. 13 - Prob. 2PSBCh. 13 - Kato Corporation began the month of June with...Ch. 13 - Prob. 4PSBCh. 13 - Prob. 5PSBCh. 13 - Prob. 6PSBCh. 13 - This serial Problem began in Chapter 1 and...Ch. 13 - Refer to Apples financial statements in appendix A...Ch. 13 - Prob. 2BTNCh. 13 - Prob. 3BTNCh. 13 - Prob. 4BTNCh. 13 - Prob. 5BTNCh. 13 - Prob. 6BTNCh. 13 - Prob. 7BTNCh. 13 - Prob. 8BTNCh. 13 - Prob. 9BTN
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
- Using the Value Line Investment Survey report in Exhibit 11.5, find the following information for Apple. What was the amount of revenues (i.e., sales) generated by the company in 2017? What were the latest annual dividends per share and dividend yield? What is the earnings per share (EPS) projection for 2019? How many shares of common stock were outstanding? What were the book value per share and EPS in 2017? How much long-term debt did the company have in the third quarter of 2018?arrow_forwardPresented below are selected financial data from the Medtronic 2018 annual report. Using the ratio definitions from Exhibit 4.6, calculate the following liquidity and solvency ratios: cash and marketable securities to total assets, quick ratio, current ratio, long-term debt to total assets, long-term debt to shareholders’ equity, and the interest coverage ratio. Evaluate Medtronic’s liquidity and solvency.arrow_forwardRequired:a. Calculate the following ratios for Sweets plc for 2021 and 2020, showing the formulas and workings:1- ROCE2- ROE3- Earnings per share4- Net profit margin5- Asset turnover6- Stock holding days7- Debtors collection period8- Current ratio9- Gearing ratio10- Interest coverarrow_forward
- . The following ratios have been calculated for Wholesale Appliances, Inc. Analyze the capital structure and long-term solvency of Wholesale Appliances, Inc. 2015 2014 Debt ratio (%) 77.8 90.3 Long-term debt to total capital (%) 29.8 66.1 Times interest earned (times) (2.0) (2.8) Cash interest coverage (times) 4.6 4.1 Fixed charge coverage (times) (0.4) (1.0) Cash flow adequacy (times) 0.2 0.3arrow_forwardRequired:a. Calculate the following ratios for Sweets plc for 2021 and 2020, showing the formulas and workings:4- Net profit margin5- Asset turnover6- Stock holding days7- Debtors collection period8- Current ratio9- Gearing ratio10- Interest coverarrow_forwardSee attached 1-3 and 1-5 information Refer to the information in Exercises 1–3 and 1–5 about Mixon Company. Compare the long-term risk and capital structure positions of the company at the end of 2006 and 2005 by computing the following ratios: (a) total debt ratio and (b) times interest earned. Comment on these ratio results.arrow_forward
- Based on this analysis how would I assess the financial stability and operational efficiency of this company? Ratio and Ratio Formula (in thousands) 2015 2014 2013 Current Industry Average Liquidity Current Ratio =Current Asset / Current Liability 9,900/6,300 1.57 1.61 1.62 1.63 Acid Test Ratio or Quick Ratio = (Cash + Marketable securities + Accounts receivable)/Current liabilities (400+300+3,200)/6,300 0.62 0.64 0.63 0.68 Solvency Times Interest Earned =Earnings before interest & taxes/interest expense, gross (7,060+900)/900 8.84 8.55 8.5 8.45 Profitability Profit margin on sales = net income/sales 7,060/30,500 14% 13.20% 12.10% 13.00% Productivity Asset turnover = sales/avg total assets 30,500/6,000+5,400)/2) 1.85 1.84 1.83 1.84 Inventory turnover = COGS/avg inv 17,600/ (6,000+5,400)/2) 3.09 3.17 3.21 3.18arrow_forwardAdditional information: • Weighted-average ordinary shares in 2017 were $60,000 QUESTIONS Based on the financial data above, do the following: a. Calculate the financial ratio of VENUS TRADING COMPANY in 2017 below: • Current ratio • Account receivable turnover • Inventory turnover • Asset turnover • Return on assets • Return on ordinary shareholders equity • Earnings per share • Debts to total assets ratio Provide an interpretation for each of the financial ratio calculations above. b. Based on the calculation results in point a, provide an analysis of performance finance VENUS TRADING COMPANY in 2017.arrow_forwardBethesda Mining Company reports the following balance sheet information for 2018 and 2019. Calculate the following financial ratios for each year: current ratio? quick ratio? cash ratio? debt-equity ratio and equity multiplier? total debt ratio?arrow_forward
- Please find below Financial Statement extracts of Nestle from year 2017 and 2018. Based on this information please answer following question from a perspective of Financial Analyst (justify your answers with data as well the reason for choosing your ratios for your analysis) .The company’s total assets at year-end 2016 were CHF 131,900 million. What reasonable conclusions an analyst might make about the companies efficiency, Companies solvency, Liquidity and Profitability? In millions of CHF Notes 2018 2017 * Sales 3 91,439 89,590 Cost of goods sold (46,070) (45,571) Trading operating profit 3 13,789 13,277 Operating profit 13,752 10,156 Profit before taxes, associates and joint ventures 12,991 9,460 Taxes 13 (3,439) (2,773) Profit for the year 10,468 7,511 Notes 2018 2017 * Assets Current assets Cash and cash equivalents 12/16…arrow_forwardI need assistance on the following regarding the attached balance sheet and income statement: Required: a) Calculate the following financial ratios for 2016 and 2017 16. Earnings per share 17. Price-earnings ratio (Use year-end adjusted closing stock price of $57.32 for 2017 and $63.69 for 2016) 18. Dividend yield 19. Dividend payout ratioarrow_forwardUsing the four-year financial statements of Tesla 2017-2020 (Appendix 2), evaluate and explain the profitability, solvency, liquidity, activity and market dimensions of Tesla’s financial performance highlighting the main weaknesses and strengths of Tesla ( ratios and explaning )arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningPFIN (with PFIN Online, 1 term (6 months) Printed...FinanceISBN:9781337117005Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
- Pfin (with Mindtap, 1 Term Printed Access Card) (...FinanceISBN:9780357033609Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
PFIN (with PFIN Online, 1 term (6 months) Printed...
Finance
ISBN:9781337117005
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (...
Finance
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning
Working capital explained; Author: The Finance Storyteller;https://www.youtube.com/watch?v=XvHAlui-Bno;License: Standard Youtube License