Solution
1. Current RatioCurrent Assets/ Current Liabilities
Current Assets= Cash+Short Term Investments+Accounts Receivable+Inventories=Â Â Â Â Â 310+260+310+320=1200
Current Liabilities=510
Current Ratio=1200/510= 2.35
2. Acid Test Ratio  =Liquid Assets/Current Liabilities
Liquid Asset= Cash+Short Term Investments+Accounts Receivable=310+260+310=880
Acid Test Ratio  = 880/510 = 1.72
3. Debt to Equity Rati= Total Liabilities/Total equity
Total Liabilities= current+long term liabilities= 510+460=970
Total Equity= paid up capital+retained earnings=1300+1030=2330
Debt Equity Ratio=970/2330=.42
4. Times Interest Earned Ratio=EBIT/Interest Expense
EBIT=Net Income+Interest+Tax=270+100+100=470
=470/100=4.7
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The 2013 balance sheet for Hallbrook Industries- Inc-- is shown below.docx
1. The 2013 balance sheet for Hallbrook Industries, Inc., is shown below.
Solution
1. Current RatioCurrent Assets/ Current Liabilities
Current Assets= Cash+Short Term Investments+Accounts Receivable+Inventories=Â Â Â Â Â
310+260+310+320=1200
Current Liabilities=510
Current Ratio=1200/510= 2.35
2. Acid Test Ratio  =Liquid Assets/Current Liabilities
Liquid Asset= Cash+Short Term Investments+Accounts Receivable=310+260+310=880
Acid Test Ratio  = 880/510 = 1.72
3. Debt to Equity Rati= Total Liabilities/Total equity
Total Liabilities= current+long term liabilities= 510+460=970
Total Equity= paid up capital+retained earnings=1300+1030=2330
Debt Equity Ratio=970/2330=.42
4. Times Interest Earned Ratio=EBIT/Interest Expense
EBIT=Net Income+Interest+Tax=270+100+100=470
=470/100=4.7
