Problem 9-8B Calculate and analyze ratios (LO9-8) Selected financial data for Surf City and Paradise Falls are as follows: ($ in millions) Total assets Total liabilities Total stockholders' equity Sales revenue Interest expense Tax expense Surf City 2021 2020 19,828 19,804 11,519 11,396 8,309 8,408 7,688 356 Required: Net income 18 Paradise Falls 2021 2020 39,161 38,637 15,232 14,805 23,929 23,832 15,382 336 4 1,298 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? Required 1: Surf City Paradise Falls Which company has the higher ratio? Required 2: Surf City Paradise Falls Which company appears more profitable? Required 3: Surf City Paradise Falls Debt to Equity Ratio = = I = Return on Assets = 1 = = Times Interest Earned Ratio = 1 = = Which company is better able to meet interest payments as they become due?