Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. required: calculate focus metals solvency ratios f

Required: Calculate Focus Metals solvency ratios for 2019 and 2020. (Round the final answers to...

50.1K

Verified Solution

Question

Accounting

imageimage

Required: Calculate Focus Metals solvency ratios for 2019 and 2020. (Round the final answers to 2 decimal places.) Ratio 2020 2019 % % % % Debt ratio Equity ratio Pledged assets to secured liabilities Times interest earned :1 :1 times times Analysis Component: Identify whether the change in each ratio from 2019 to 2020 was favourable or unfavourable. Ratio Favourable! Unfavourable Debt ratio Equity ratio Pledged assets to secured liabilities Times interest earned Refer the following table. Focus Metals Inc. Comparative Balance Sheet Information November 30 (millions of $) 2020 2019 Cash $ 33 $ 103 Accounts receivable (net) 454 300 Inventory 94 87 Plant and equipment (net) 2,88 2,970 Accounts payable 347 263 Long-term notes payable* 1,870 2,430 Common shares 470 470 Retained earnings 780 297 *90% of the plant and equipment are secured by long-term notes payable. Focus Metals Inc. Income Statement For Year Ended November 30 (millions of $) 2020 2019 Net sales $3,090 $2,292 Cost of goods sold 1,072 862 Gross profit $2,018 $1,430 Operating expenses: Depreciation expense $ 122 $ 122 Other expenses 795 662 Total operating expenses 917 784 Profit from operations $1,101 $ 646 Interest expense 195 229 Income tax expense 61 65 Profit $ 845 $ 352

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students