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ID: 2515058 • Letter: #

Question

: For quick access, place your bookmarks here on the bookmarks bar. Import bookmarks now Selected financial data for Bahama Bay and Caribbean Key are as follows: (S in millions) Bahama Bay Caribbean Key Total assets Total liabilties Total stockholders' equty 2018 201720182017 9503 $ 9,422 $ 8,703 $ 8,742 7,982 7446 ,423 413 1,521 1,976 1,280 1,329 Sales revenue Interest expense Tax expense Net income $ 5,807 S 12,7r9 143 340 342 180 300 Required: 1-a. Calculate the debt to equity ratio for Bahama Bay and Caribbean Key for the most recent year. (Do not round intermedia $5.500,000 should be entered as 5.5).) Debt to Equity Ratic Bahama Bay Caribbean Key 1-b. Which company has the higher ratio? O Bahama Bay O Caibbean Key

Explanation / Answer

Answer;

1

1a debt to equity ratio

total liabilities

/

total stockholder
equity

Bahamas Bay

7982

/

1521

5.248

Caribbean Key

7423

/

1280

5.799

1-b

Which company has the higher ratio?

Caribbean Key

___________________________________

2

2.a Return on asset

Net income

/

Average Total Assets

Bahamas Bay

309

/

9462.5

3.27%

Caribbean Key

342

/

8722.5

3.92%

2-b

Which Company appear more profitable

Carribbean Key

____________________________________________

3

3.a times interest earned ratio

Net income + Interest + Taxes

Interest

Bahamas Bay

555

/

66

8.409

Caribbean Key

825

/

340

2.426

3-b

Bahamas Bay

1a debt to equity ratio

total liabilities

/

total stockholder
equity

Bahamas Bay

7982

/

1521

5.248

Caribbean Key

7423

/

1280

5.799

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