Hsu Company Reported the Following on Its Income Statement

question 91

Multiple Choice

Hsu Company reported the following on its income statement: Interest expense was $80,000. Hsu Company's times interest earned ratio is

• A)8 times
• B)6.25 times
• C)5.25 times
• D)5 times

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Definitions:

Overhead Costs

Expenses related to the day-to-day running of a business that are not directly linked to a specific product or service, such as rent, utilities, and administrative expenses.

Overhead Costs

Expenses related to the day-to-day running of a business that can't be directly linked to any specific product or service.

Directly Related

Having a direct connection or relevance to another factor, typically implying a cause-and-effect relationship or close association.

Direct Materials

Raw materials that can be directly attributed to the production process of a specific product.