Author Question: The income statement for Otto Construction Company appears below:Net sales (all credit ... (Read 39 times)

ncasson210 · **on:** Feb 5, 2023

Question 1

The 2021 and 2022 partial balance sheets for Ottoman Manufacturing Company appear below:

2021

2022

Current liabilities	$ 20,000	$ 30,000
Noncurrent liabilities	60,000	40,000
Total liabilities	80,000	70,000
Stockholders' equity
Common stock	2,000	2,000
Additional paid-In capital	4,000	4,000
Retained earnings	40,000	26,000
Total stockholders' equity	46,000	32,000
Total liabilities and stockholders' equity	$126,000	$102,000

What is the debt-to-equity ratio for 2022?
◦ 2.19
◦ 1.80
◦ 0.46
◦ 1.25

Question 2

The income statement for Otto Construction Company appears below:

Net sales (all credit sales)	$180,000
Cost of goods sold	100,000
Gross margin	80,000
Operating expenses	30,000
Interest expense	12,000
Income before taxes	38,000
Income tax	9,500
Net income	$ 28,500

Average total assets total $240,000. Otto's income tax rate is 25%. What is the times interest earned ratio?
◦ 3.16
◦ 2.38
◦ 4.17
◦ 3.13

Sha · **Reply #1 on:** Feb 5, 2023

A FREE account is required to view all solutions!

Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.

Answer Preview

Only 29% of students answer this correctly