CP$10-3($Static$)$ Comparing Companies within an Industry LO$10-3,10-6$

Refer to the financial statements of Target $($Appendix B$)$ and Walmart $($Appendix C$)$ and the Industry Ratio Report $($Appendix D$).$

Required:

Compute the debt$-$to$-$equity ratio for both companies for the most recent fiscal year.

Which company relied more heavily on debt financing relative to equity financing during the most recent fiscal year?

Compare the debt$-$to$-$equity ratios for Target and Walmart to the average debt$-$to$-$equity ratio for the retail industry. Do Target and Walmart rely more or less heavily on debt financing relative to equity financing compared to the industry average?

Compute the times interest earned ratio for both companies for the most recent fiscal year. $($Hint: Include any interest expense related to capital leases and financing obligations when calculating the times interest earned ratio for Walmart.$)$

Which company generated a greater amount of income relative to interest expense during the most recent fiscal year?