The Following Information Was Obtained from the Records of Trophy

question 48

Multiple Choice

The following information was obtained from the records of Trophy Company for 2010: $\begin{array}{ll}\text { Net sales } & \$ 2,600,000 \\\text { Interest expense } & 80,000 \\\text { Income tax expense } & 40,000 \\\text { Net income } & 100,000\end{array}$ How many times was interest earned in 2010?

• A)1.25 times
• B)1.75 times
• C)2.75 times
• D)32.5 times

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Definitions:

Lithosphere

The rigid outer layer of the Earth, composed of the crust and the upper part of the mantle.

Biosphere

The spherical zone that includes life and all of the places life can exist on, below, and above Earth’s surface.

Rapid City Flood

A catastrophic flood event that occurred in Rapid City, South Dakota, in 1972 due to heavy rainfall.

Flash Flood

A local and sudden flood of short duration, such as that which may follow a brief but heavy rainfall.