Consider the following information: Gil\'s Fish and Tackle, Inc. Balance Sheet A
ID: 2499891 • Letter: C
Question
Consider the following information: Gil's Fish and Tackle, Inc.
Balance Sheet At December 31, 2016
Assets
Cash $ 24,700
Accounts Receivable (less allowance) 181,400
Inventories 121,300
Property, Plant and Equipment 192,800
Long-term Investments 120,000
Total Assets $ 640,200
Liabilities
Accounts Payable
$ 53,700
Current Portion of Long-Term Debt 75,100
Long-Term Notes Payable 121,000
Total Liabilities 249,800
Stockholders' Equity Contributed Capital 280,000
Retained Earnings 110,400
Total Stockholders’ Equity 390,400
Total Liabilities and Stockholders’ Equity $ 640,200
Gil's Fish and Tackle, Inc.
Income Statement For the year ending December 31, 2016
Sales Revenue $ 3,035,000
Operating Expenses
Salaries and Wages Expense 1,931,500
Operating and Admin. Expenses 313,700
Depreciation Expense 365,100
Operating Expenses 2,610,300
Operating Income 424,700
Other Expenses Interest Expense 18,150
Income Before Income Tax Expense 406,550
Income Tax Expense 150,424
Net Income $ 256,126
Required: Calculate the debt-to-assets ratio and the times interest earned for the following company. (Round your answers to 2 decimal places.)
Explanation / Answer
Debt to Assets = Total liabilities / total Assets = 249800 / 640200 = 0.39 times Times Interest earned ratio = Income before interest and tax / Interest Expenses = 424700 / 18150 = 23.40 times
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