The following information is available from the balance sheets at the ends of the two most recent…

The following information is available from the balance sheets at the ends of the two most recent years and the income statement for the most recent year of Impact Company:Other Informationa. Short-term notes payable represents a 12-month loan that matured in November 2010. Interest of 12% was paid at maturity.b. One million dollars of serial bonds had been issued ten years earlier. The first series of $200,000 matured at the end of 2010, with interest of 8% payable annually.c. Cash flow from operations was $185,000 in 2010. The amounts of interest and taxes paid during 2010 were $89,000 and $96,000, respectively.Required1. Compute the following for Impact Company:a. The debt-to-equity ratio at December 31, 2010, and December 31, 2009b. The times interest earned ratio for 2010c. The debt service coverage ratio for 20102. Comment on Impact’s solvency at the end of 2010. Do the times interest earned ratio and the debt service coverage ratio differ in their indication of Impact’s ability to pay its debts?Explain.
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The following information is available from the balance sheets a