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11.4 Calculate financial leverage measures The following information was available for the year

11.4 Calculate financial leverage measures The following information was available for the year

11.4
Calculate financial leverage measures The following information was available for the year ended December 31, 2016:
Earnings before interest and taxes (operating income)
$120,000
Interest expense 20,000
Income tax expense 30,000
Net income   70,000
Total assets at year-end 400,000
Total liabilities at year-end 240,000
Required:
Calculate the debt ratio at December 31, 2016.
Calculate the debt/equity ratio at December 31, 2016.
Calculate the times interest earned for the year ended December 31, 2016.

 
manish jayant 09-Sep-2020

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