The following information was available for the year ended December 31, 2016: Earnings before interest and taxes (operating income) $ 81,000
Interest expense 17,000 Income tax expense 22,000
Net income 42,000
Total assets at year-end 270,000
Total liabilities at year-end 148,000
Required:
a. Calculate the debt ratio at December 31, 2016. (Round your answer to 1 decimal place.)
b. Calculate the debt/equity ratio at December 31, 2016. (Round your answer to 2 decimal places.)
c. Calculate the times interest earned for the year ended December 31, 2016. (Round your answer to 2 decimal places.)

Answer and Explanation:

The calculation is given below:

a. The debt ratio is

= Total liabilities ÷ total assets

= $148,000 ÷ $270,000

= 0.5 times

b. The debt/equity ratio is

= Debt ÷ equity

= $148,000 ÷ ($270,000 - $148,000)

= $148,000 ÷ $122,000

= 1.21 times

c. The times interest earned ratio is

= earning before interest and taxes ÷ interest expense

= $81,000 ÷ $17,000

= 4.76 times

hi,

henry is an economist and wants to understand the relationship between inflation and consumer spending habits. for his research, he needs the consumer price index for 2014 and the inflation rate. based on the prices of goods given, what will he find to be the cpi and inflation rate for 2014? assume that a consumer’s basket for three consecutive years consists of the following:

you dont privide answer choices.

answer - 15% of a inflatation rate is 15% less in cpi