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Compute the new ratios

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Reference no: EM132555662

Carla Vista Co. provides you with the following balance sheet information as of December 31, 2022.

Current assets $11,040               Total assets $36,480

Long term Assets $25,440               Current liabilities $11,520

Total assets $36,480                        Long-term liabilities $13,440

Stockholders' equity $11,520

Total liabilities and stockholders' equity $36,480

Carla Vista reported net income for 2022 of $15,360, income tax expense of $3,072, and interest expense of $1,248.

Current ratio and working capital for Carla Vista for 2022.

Question 1: Assume that at the end of 2022, Carla Vista used $2,880 cash to pay off $2,880 of accounts payable. Compute the new ratios.

Question 2: Compute the debt to assets ratio and the times interest earned for Carla Vista for 2022.

Reference no: EM132555662

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