Debt -equity ratio-times interest earned ratio


Problem:

Bayside, Inc. 2008 Income Statement ($ in thousands) Net Sales $5,680 Less:COGS 4,060 Less: Depreciation 420 Earnings before interest and taxes 1,200 Less: Interest Paid 30 Taxable Income $1,170 Less: Taxes 410 Net Income $760 Bayside, Inc. 2007 and 2008 Balance Sheets ($in thousands) 2007 2,008 Cash $70 $180 Accounts Rec. 980 840 Inventory 1,560 1,990 Total $2,610 $3,010 Net Fixed Assets 3,600 3,360 Total Assets $6,210 $6,370 Accounts Payable $1,350 $1,170 Long-Term Debt 720 500 Common Stock 3,200 3,500 Returned Earnings 940 1,200 Total Liabilities and Equity $6,210 $6,370

Required:

Question 1: In 2008, how many days on average did it take Bayside to sell its inventory?

Question 2: What is the debt -equity ratio for 2008?

Question 3: What is the times interest earned ratio for 2008?

Question 4: What is the equity multiplier for 2008?

Question 5: What is the return on equity for 2008?

Note: Explain all steps comprehensively.

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Accounting Basics: Debt -equity ratio-times interest earned ratio
Reference No:- TGS0889663

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