Selected financial data for Bahama Bay and Caribbean Key are as follows:
$ in millions Bahama Bay Caribbean Key
Total assets $ $ $ $
Interestbearing debt
Other liabilities
Total stockholders equity
Sales revenue $ $
Interest expense
Tax expense
Net income
Required:
a Calculate the debt to equity ratio for Bahama Bay and Caribbean Key for the most recent year.
b Which company has the higher ratio?
a Calculate the times interest earned ratio for Bahama Bay and Caribbean Key for the most recent year.
b Which company is better able to meet interest payments as they become due?
