The income before taxes and interest expense of Barry Builders for the year just ended is $213,000. Their interest expense is $21,000 and their income taxes are $82,500. The number of times interest would be earned is: (Round your answer two decimal places.)
A) 15.07.
B) 10.14.
C) 11.14.
D) 0.49.

Question

Quizplus · Accepted Answer

The times interest earned ratio is calculated as (Income before taxes and interest) / (Interest expense). So, $213,000 / $21,000 = 10.14.

The Income Before Taxes and Interest Expense of Barry Builders