Rhodes Bakery The balance sheet taken from the company's annual financial statements for the year ended...

 

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Rhodes Bakery The balance sheet taken from the company's annual financial statements for the year ended December 2017 is provided below: Assets: Current Assets: Long-term Assets: Total Assets Long-term Liabilities: Cash Accounts Receivable Inventory Shareholders' Equity Other Current Assets Total Current Assets Liabilities and Shareholders' Equity Current Liabilities: Property. Plant & Equipment, net Intangible Assets R1.054.750 Accounts Payable Interest Payable Current Portion of Long- Term Debt Income Tax Payable Total Current Liabilities Notes Payable Total Liabilities Ordinary shares December 31 2017 R61,100 22,500 8,500 6.500 98,600 744,900 211.250 R334.000 R5,500 500 15,000 18.500 R39,500 246,250 285,750 60,000 2016 R54,000 17,500 7,000 5.500 84,000 25,000 225.000 R4,500 500 0 23.000 28,000 15.000 43,000 35,000 Total Liabilities and Shareholders' Equity Additional Paid-in Capital 654,000 Retained Earnings 92,500 Treasury Stock (37.500) Total Shareholders' Equity 769,000 R334,000 R1,054,750 Required: Calculate the following debt management ratios for 2017 and 2016: 1. Times Interest Earned Ratio, 2. Long-Term Debt-to-Equity Ratio, 3. Debt-to-Equity Ratio, 4. Long-Term Debt-to-Assets Ratio, and Debt-to-Assets Ratio. 186,000 70,000 Q 291,000 Income from operations were R65, 000 and R49, 000 and interest expense was R26, 000 and R1, 750 for 2020 and 2019, respectively. Round your answers to two decimal places. 5. Comment on the company's debt management. Rhodes Bakery The balance sheet taken from the company's annual financial statements for the year ended December 2017 is provided below: Assets: Current Assets: Long-term Assets: Total Assets Long-term Liabilities: Cash Accounts Receivable Inventory Shareholders' Equity Other Current Assets Total Current Assets Liabilities and Shareholders' Equity Current Liabilities: Property. Plant & Equipment, net Intangible Assets R1.054.750 Accounts Payable Interest Payable Current Portion of Long- Term Debt Income Tax Payable Total Current Liabilities Notes Payable Total Liabilities Ordinary shares December 31 2017 R61,100 22,500 8,500 6.500 98,600 744,900 211.250 R334.000 R5,500 500 15,000 18.500 R39,500 246,250 285,750 60,000 2016 R54,000 17,500 7,000 5.500 84,000 25,000 225.000 R4,500 500 0 23.000 28,000 15.000 43,000 35,000 Total Liabilities and Shareholders' Equity Additional Paid-in Capital 654,000 Retained Earnings 92,500 Treasury Stock (37.500) Total Shareholders' Equity 769,000 R334,000 R1,054,750 Required: Calculate the following debt management ratios for 2017 and 2016: 1. Times Interest Earned Ratio, 2. Long-Term Debt-to-Equity Ratio, 3. Debt-to-Equity Ratio, 4. Long-Term Debt-to-Assets Ratio, and Debt-to-Assets Ratio. 186,000 70,000 Q 291,000 Income from operations were R65, 000 and R49, 000 and interest expense was R26, 000 and R1, 750 for 2020 and 2019, respectively. Round your answers to two decimal places. 5. Comment on the company's debt management.

Answer rating: 100% (QA)

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