Essay About Interest Coverage And Tiogas Operations

Managerial Accounting Ch. 21
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Return on sales – nY/Sales
= 5400/60000
= .09
ROA – nY + Int Exp (net of tax) / Avg Total Assets
top = 5400 + (1500 x .06) = 6300
avg tot. assets: = 40000 + 38250 / 2 = 39375
(6300 / 39375) = .16
ROE – nY/Avg Common Stockholders Equity
5400 / [(19500 + 16275)/2]
= .3018
Current ratio – Current assets / Current liabilities
10,800 / 9000
= 1.2
Acid – Test – Quick Assets / Current Liabilities
QA= Cash & Mkt. Sec. + A/R
(1950 +3600)/9000
= .61
Debt to Equity Ratio – Total Liabilities/Total stockholders Equity
21000/19500
= 1.08
Interest Coverage – Operating Y (nY before taxes) / Int Expense
9000 / 1500
Dividend Payout Ratio – Div p/ share of common stock / earnings p/ share
3.86 / 8.18
= 47.19
name of ratio
Indstry Ratio
Tioga
Effect
Current
Acid-Test
Debt-Equity
Int Coverage
Dividend Payout
39.57
47.19%
Return on Sales
12.48
30.18%
Tiogas operations have proven them to perform at a level where risk is reduced