Refer to Wal-Mart's Financial Statements, Below $\$ 0.10$ Par Value; 100 Share Authorized

Refer to Wal-Mart's financial statements, below.
Shareholders' Equity
Preferred stock ( $\$ 0.10$ par value; 100 share authorized. none issued)

Common stock ( $\$ 0.10$ par value; 5.500 million shares authorized. 2,285 million and 2,293 million issued and
$\begin{array}{lr} \text { outstanding in 1997 and 1996, respectively) } &228&229\\ \text {Capital in excess of par value } &547&545\\ \text { Retained earnings} &16,768&14,394\\ \text { Foreign currency translation adjustment} &\underline{(400)}&\underline{(412)}\\ \text { Total shareholders' equity } &\underline{17,143}&\underline{14,756}\\ \text { Total liabilities and shareholders' equity } \underline{\underline{\$39,604}}&\underline{\underline{\$37,541}}\\\end{array}$

a. Calculate: total debt to equity ratio and times interest earned ratio for fiscal X6 and X7. Comment on your results.

b. Analysis of Wal-Mart's footnotes reveals the existence of significant operating leases. Explain whether this would change your answer in part a) and how you would make the changes.