152. Selected financial data for these two close competitors in the home building industry are provided below:
($ in millions)
Company A
Company B
Total assets
$40,877
$33,005
Total liabilities
21,484
13,936
Total stockholders’ equity
19,393
19,069
Sales
$66,176
$47,220
Interest expense
676
287
Tax expense
1,362
1,042
Net income
2,620
1,783
1. Calculate the debt to equity ratio for Company A and Company B. Which company has the higher ratio?
2. Calculate the times interest earned ratio for Company A and Company B. Which company is better able to meet interest payments as they become due?
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