The Following Information Was Available for the Year Ended December

question 26

Essay

The following information was available for the year ended December 31, 2019:
$$\begin{array} { l r } \text { Earnings before interest and taxes (operating income) } & \$ 9 7 , 5 0 0 \\\text { Interest expense } & 15,000 \\\text { Income tax expense } & 22,500 \\\text { Net incorne } & 60,000 \\\text { Total assets at year-end } & 288,000 \\\text { Total liabilities at year-end } & 216,000\end{array}$$ Required:
(a.)Calculate the debt ratio at December 31, 2019.
(b.)Calculate the debt/equity ratio at December 31, 2019.
(c.)Calculate the times interest earned for the year ended December 31, 2019.

---

Definitions:

Cohesion

The force that binds members of a group together, creating a sense of belonging and mutual support among its members.

Group Unity

The degree to which members of a group or team feel connected and committed to each other, often characterized by shared goals, mutual support, and coherence.

Tuckman's Group Development

A theory proposing that teams go through distinct stages: forming, storming, norming, performing, and adjourning.

Storming

A stage in group development where members experience conflicts and competition as they seek to establish roles and norms within the group.