In the recent year Hill Corporation had net income of $210,000, interest expense of $60,000, and tax expense of $90,000. What was Hill Corporation's times interest earned ratio for the year?
A) 6.0
B) 5.0
C) 4.5
D) 3.5

Question

Quizplus · Accepted Answer

The times interest earned ratio is calculated as (Net Income + Interest Expense + Tax Expense) / Interest Expense. Plugging in the given values: ($210,000 + $60,000 + $90,000) / $60,000 = $360,000 / $60,000 = 6.0.

In the Recent Year Hill Corporation Had Net Income of $210,000