a. Hasbro, 1.7 Ratio of liabilities to stockholders’ equity and times interest earned Hasbro, Inc. (HAS), and Mattel, Inc . (MAT), are the two largest toy companies in North America. Condensed liabilities and stockholders’ equity from a recent balance sheet are shown for each company as follows (in thousands): Hasbro Mattel Liabilities Current liabilities $1,617,859 $1,505,473 Long term debt 1,588,067 2,580,439 Total liabilities $3,205,926 $4,086,012 Total stockholders’ equity $1,862,736 $2,407,782 Total liabilities and stockholders’ equity $5,068,662 $6,493.794 The operating income and interest expense from the income statement for each company were as follows (in thousands): Hasbro Mattel Operating income (before income tax expense) Interest expense $692,489 97,405 $409,472 95,118 a. Determine the ratio of liabilities to stockholders’ equity for high companies Round to one decimal place. b. Determine the times interest earned ratio for both companies. Round to one decimal place. c. Interpret the ratio differences between the two companies.

BuyFind

Corporate Financial Accounting

15th Edition
Carl Warren + 1 other
Publisher: Cengage Learning
ISBN: 9781337398169
BuyFind

Corporate Financial Accounting

15th Edition
Carl Warren + 1 other
Publisher: Cengage Learning
ISBN: 9781337398169
Chapter 14, Problem 14.14EX
Textbook Problem

a. Hasbro, 1.7

Ratio of liabilities to stockholders’ equity and times interest earned

 Hasbro, Inc. (HAS), and Mattel, Inc. (MAT), are the two largest toy companies in North America. Condensed liabilities and stockholders’ equity from a recent balance sheet are shown for each company as follows (in thousands):

Hasbro Mattel
Liabilities
Current liabilities $1,617,859 $1,505,473
Long term debt 1,588,067 2,580,439
Total liabilities $3,205,926 $4,086,012
Total stockholders’ equity $1,862,736 $2,407,782
Total liabilities and stockholders’ equity $5,068,662 $6,493.794

 The operating income and interest expense from the income statement for each company were as follows (in thousands):

Hasbro Mattel

Operating income (before income tax expense)

Interest expense

$692,489

97,405

$409,472

95,118

a. Determine the ratio of liabilities to stockholders’ equity for high companies Round to one decimal place.

b. Determine the times interest earned ratio for both companies. Round to one decimal place.

c.    Chapter 14, Problem 14.14EX, a. Hasbro, 1.7 Ratio of liabilities to stockholders equity and times interest earned Hasbro, Inc. Interpret the ratio differences between the two companies.

Expert Solution

Want to see the full answer?

Check out a sample textbook solution.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times vary by subject and question complexity. Median response time is 34 minutes and may be longer for new subjects.

Chapter 14 Solutions

Corporate Financial Accounting
Ch. 14 - Horizontal analysis The comparative accounts...Ch. 14 - Vertical analysis Income statement information for...Ch. 14 - Current position analysis The following items are...Ch. 14 - Accounts receivable analysis A company reports the...Ch. 14 - Inventory analysis A company reports the...Ch. 14 - Long-term solvency analysis The following...Ch. 14 - To determine: Times interest earned ratio Given...Ch. 14 - Asset turnover A company reports the following:...Ch. 14 - Return on total assets A company reports the...Ch. 14 - Common stockholders profitability analysis A...Ch. 14 - Earnings per share and price-earnings ratio A...Ch. 14 - Vertical analysis of income statement Revenue and...Ch. 14 - a Current fiscal year income from continuing...Ch. 14 - Common-sized income statement Revenue and expense...Ch. 14 - Vertical analysis of balance sheet Balance shed...Ch. 14 - a. Net income increase, 78,0% Horizontal analysis...Ch. 14 - a. (1) Current year working capital. 1,090,000...Ch. 14 - a. (1) Current years current ratio. 1,3 Current...Ch. 14 - Current position analysis The bond indenture for...Ch. 14 - Accounts receivable analysis The following data...Ch. 14 - Accounts receivable analysis Xavier Stores Company...Ch. 14 - Inventory analysis The following data were...Ch. 14 - Inventory analysis QT, Inc. and Elppa Computers,...Ch. 14 - Ratio of liabilities to stockholders' equity and...Ch. 14 - a. Hasbro, 1.7 Ratio of liabilities to...Ch. 14 - a. Mondelez International Inc., 1.4 Ratio of...Ch. 14 - a. YRC, 2.6 Asset turnover Three major segments of...Ch. 14 - Profitability ratios The following selected data...Ch. 14 - a. Year 3 return on total assets. 6.8%...Ch. 14 - Six measures of solvency or profitability The...Ch. 14 - Five measures of solvency or profitability The...Ch. 14 - Earnings per share, price-earnings ratio, dividend...Ch. 14 - a. Alphabet, 37.9 Price-earnings ratio; dividend...Ch. 14 - Earnings per share, discontinued operations The...Ch. 14 - Income statement and earnings per share for...Ch. 14 - Unusual items Explain whether Colston Company...Ch. 14 - Comprehensive Income Anson Industries, Inc....Ch. 14 - Horizontal analysis of income statement For 20V2,...Ch. 14 - Vertical analysis of income statement For 20Y2,...Ch. 14 - Effect of transactions on current position...Ch. 14 - Measures of liquidity, solvency, and profitability...Ch. 14 - Solvency and profitability trend analysis Addai...Ch. 14 - Horizontal analysis of income statement For 20Y2,...Ch. 14 - Vertical analysis of income statement For 20Y2,...Ch. 14 - Effect of transactions on current position...Ch. 14 - Measures of liquidity, solvency and profitability...Ch. 14 - Solvency and profitability trend analysis Crosby...Ch. 14 - Analyze and compare Amazon.com, Best Buy, and...Ch. 14 - Analyze and compare Alphabet, PepsiCo, and...Ch. 14 - Analyze Deere Company Deere Company (DE)...Ch. 14 - Analyze and compare Marriott and Hyatt Marriott...Ch. 14 - Ethics in Action Rodgers Industries Inc. completed...Ch. 14 - Communication The president of Freeman Industries...

Additional Business Textbook Solutions

Find more solutions based on key concepts
What is the difference between a committee and a task force?

Foundations of Business (MindTap Course List)

In what ways is economics a science?

Principles of Microeconomics (MindTap Course List)

Why do economists make assumptions?

Brief Principles of Macroeconomics (MindTap Course List)

STATEMENT OF CASH FLOWS You have just been hired as a financial analyst for Basel Industries. Unfortunately, co...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)