Selected financial data for Surf City and Paradise Falls are as follows:

Required:

1. Calculate the debt to equity ratio for Surf City and Paradise Falls for the most recent year. Which company has the higher ratio?

2. Calculate the return on assets for Surf City and Paradise Falls. Which company appears more profitable?

3. Calculate the times interest earned ratio for Surf City and Paradise Falls. Which company is better able to meet interest payments as they become due?

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($ in millions) Surf City Paradise Falls 2021 2020 2021 2020 Total assets $19,828 $19,804 $39,161 $38,637 Total liabilities 11,519 11,396 15,232 14,805 Total stockholders' equity 8,309 8,408 23,929 23,832 Sales revenue $ 7,688 $15,382 Interest expense 356 336 Tax expense 4 Net income 18 1,298