The Following Selected Ratios Are Available for Rainbow Corporation for the Three

Essay

The following selected ratios are available for Rainbow Corporation for the three most recent years: $\begin{array}{lccc}&2015&2014&2013\\\text { Debt to total assets } & \overline{48 \%} & \overline{52 \%} & \overline{60 \%} \\\text { Interest coverage } & 2.5 \text { times } & 2.6 \text { times } & 2.0 \text { times } \\\text { Free cash flow } & \$ 600,000 & \$ 590,000 & \$ 200,000\end{array}$
Instructions
Using each of the three ratios above to support your answer, explain whether or not Rainbow's solvency has improved over the last three years.