Ridgeview Ltd. has the following obligations outstanding at…

Ridgeview Ltd. has the following obligations outstanding at December 31, 2026: A bank loan due in 18 months. Accounts payable due in 30 days. Employee wages earned but unpaid at year-end. Interest payable on a note payable. The CFO is reviewing the draft statement of financial position and wants to identify which obligation should be classified as a long-term liability. Which obligation should be reported as a long-term liability?

Summit Industrial Ltd. is negotiating a new long-term financ…

Summit Industrial Ltd. is negotiating a new long-term financing arrangement with its bank. During the credit review process, the lender indicates that it will evaluate the company’s ability to meet its ongoing interest obligations. For 2026, Summit reports: Income before interest expense and income taxes: $720,000 Interest expense: $120,000 The bank asks management to calculate the company’s Times Interest Earned ratio. What is Summit’s Times Interest Earned ratio?

Northern Manufacturing is negotiating a large bank loan. The…

Northern Manufacturing is negotiating a large bank loan. The bank has indicated that it is particularly concerned with the company’s leverage position. Prior to obtaining the loan, the company reports: Total liabilities: $1,800,000 Shareholders’ equity: $1,200,000 Management is considering issuing additional shares to improve its leverage ratios. What is Northern Manufacturing’s current debt-to-equity ratio?