Question

Surf's Up, a manufacturer of surfing supplies and training equipment, has the following selected data ($ in millions): Surf's Up Selected balance sheet data 2021 Total assets $ 747 Total liabilities 618 Total stockholders' equity 129 2020 $ 738 520 218 Surf's Up Selected income statement data 2021 Sales revenue $815 Interest expense 17 Tax expense Net income 56 34 Based on these amounts, calculate the following ratios for 2021: (Do not round intermediate calculations. Round all final answers to 1 decimal place. Enter your answers in millions (i.e. 5,500,000 should be entered as 5.5).) Answer is not complete. Total liabilities Debt to Equity Ratio Total Stockholders' equity 129.0 4.8 618.0 Return on Assets Ratio Net income Average total assets 56.0 742.5

Answer 1

Debt To Equity Ratio Numerator 17 Denominator Debt / Shareholder Equity 618 7 129 = = Debt To Equity Debt To Equity Years 2021 4.8 Year Return on Assets Numerator / Denominator Net Income 17 Average Total Assets 56.00 7 742.50 = Return on Assets Return on Assets 7.5 % 2021 Times Interest Earned Ratio Denominator = Times Interest Earned Interest Expense = Times Interest Earned 6.3 times Numerator EBIT 107 Years 20211 7 / 17