Kim Chen Corporation is a wholesaler of scuba gear. During 2016, Chen expanded its retail business by adding over 50 dive shops. The following information is obtained from the comparative financial statements included in the company's 2016 annual report all amounts are in thousands of dollars:
A. Debt-to-equity ratio at each year-end
B. Times interest earned ratio
2 Comment briefly on the company's solvency.
3 What other ratios will help you assess the solvency? What information will they provide that you do not already have concerning the company's solvency?

Question

Kim Chen Corporation is a wholesaler of scuba gear. During 2016, Chen expanded its retail business by adding over 50 dive shops. The following information is obtained from the comparative financial statements included in the company's 2016 annual report all amounts are in thousands of dollars:
  A. Debt-to-equity ratio at each year-end
B. Times interest earned ratio
2 Comment briefly on the company's solvency.
3 What other ratios will help you assess the solvency? What information will they provide that you do not already have concerning the company's solvency?

Quizplus · Accepted Answer

The Answer of Kim Chen Corporation is a wholesaler of scuba gear. During 2016, Chen expanded its retail business by adding over 50 dive shops. The following information is obtained from the comparative financial statements included in the company's 2016 annual report all amounts are in thousands of dollars:
  A. Debt-to-equity ratio at each year-end
B. Times interest earned ratio
2 Comment briefly on the company's solvency.
3 What other ratios will help you assess the solvency? What information will they provide that you do not already have concerning the company's solvency?

Kim Chen Corporation Is a Wholesaler of Scuba Gear