Selected financial data for Company A is provided below: What is the times interest earned ratio for Company A?
$$\begin{array} { | l | r | }
\hline \text { ( in milions) } & \text { Compary } A \
\hline \text { Sales } & \$ 66,176 \
\hline \text { Interest expense } & 676 \
\hline \text { Tax expense } & 1,362 \
\hline \text { Net income } & \$ 2,620 \
\hline
\end{array}$$

Question

Selected financial data for Company A is provided below: What is the times interest earned ratio for Company A?
$$\begin{array} { | l | r | } 
\hline \text { ( in milions) } & \text { Compary } A \
\hline \text { Sales } & \$ 66,176 \
\hline \text { Interest expense } & 676 \
\hline \text { Tax expense } & 1,362 \
\hline \text { Net income } & \$ 2,620 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The times interest earned ratio is calculated as (Net Income + Interest Expense + Tax Expense) / Interest Expense. For Company A, it is (2,620 + 676 + 1,362) / 676 = 6.9 times.

Selected Financial Data for Company a Is Provided Below: What