Friendly Skies Airline has earnings before interest and taxes of $21,680 and net income of $12,542.The tax rate is 35 percent.What is the times interest earned ratio?
A)0.88
B)1.73
C)3.09
D)5.59
E)9.09

Name: Friendly Skies Airline has earnings before interest and taxes of $21,680 and net income of $12,542.The tax rate is 35 percent.What is the times interest earned ratio? A)0.88 B)1.73 C)3.09 D)5.59 E)9.09
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Question

Quizplus · Accepted Answer

Times interest earned ratio = $21,680/{$21,680 - [$12,542/(1 - 0.35)]} = 9.09

Friendly Skies Airline Has Earnings Before Interest and Taxes of $21,680