Consecutive five-year balance sheets and income statements of Donna Szabo Corporation are
shown below and on the following page.
Required
a. Compute or determine the following for the years 20052009:
1. Degree of financial leverage
2. Earnings per common
Allen Company and Barker Company are competitors in the same industry. Selected
financial data from their 2009 statements follow.
.:.
Required
a. Compute the following ratios for each company:
1. Times interest earned
2. Debt ratio
3. Debt/equity ratio
4.
Ahl Enterprise lists the following data for 2009 and 2008:
.:.
Required
Calculate the net profit margin, return on assets, total asset turnover, and return on common
equity for both years. Comment on the results. (For return on assets and total asset turn
Leverage and Risk
Just now
A highly leveraged financial system is one prone to collapse. This notion underlies modern
financial regulation: the control of systemic risk requires controlling leverage. And, it is what
drives proposals for high capital requi