If a company had net income of $2,379,600,interest expense of 234,000,a tax rate of 40%,and operating income of $4,200,000,what is the times interest earned ratio?
A)10.17
B)17.95
C)7.78
D)7.18
E)4.07

Question

Quizplus · Accepted Answer

The times interest earned ratio is calculated as operating income divided by interest expense. Here, it is $4,200,000 / $234,000 = 17.95.

If a Company Had Net Income of $2,379,600,interest Expense of 234,000,a