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For many years, Borders Group and Barnes and Noble were the dominant booksellers in the United States. They experienced rapid growth, and in the process they forced many small, independent bookstores out of business. Recently, Borders filed for bankruptcy. It was the victim of its inability to change with the times. It did not develop a viable business plan for dealing with digital books and online sales. Below is financial information (in millions) for the two companies, taken from the annual reports of each company one year before Borders filed for bankruptcy. Borders Barnes and Noble Current assets $978.7 $1,719.5 Total assets 1,415.6 3,705.7 1,724.4 Current liabilities 918.1 Total liabilities 1.2573 2,802.3 Net income/loss) (109.4) Interest expense 24.1 Tax expense/income tax benefit) (313) Compute the current ratio for each company. (Round answers to 2 decimal places, e.g. 6.25:1.) Borders Barnes and Noble Current ratio e Textbook and Media Compute the debt to assets ratio and times interest earned for each company. (Hint: A tax benefit means that rather than pay taxes, the company was due a refund because of its losses. For ratio purposes, a tax benefit is treated the opposite of tax expense. (Round times interest earned to 2 decimal places, e.g. 15.25 and other answers to O decimal places, e.g. 15%. Enter negative answers using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Borders Barnes and Noble Debt to assets Times interest earned times times

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