In 20X4, P Co Reported Net Earnings of $1,933 Million

question 32

Multiple Choice

In 20X4, P Co reported net earnings of $1,933 million, interest expense of $395 million and income taxes of $270 million. In 20X3, they reported net earnings of $2,142 million, interest expense of $478 million and income taxes of $818 million. Calculate the times interest earned ratio for 20X4 and 20X3, respectively.

• A) 5.05 and 4.48 times
• B) 6.58 and 7.19 times
• C) 5.73 and 6.19 times
• D) 6.05 and 5.48 times

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Definitions:

Hereditarianism

The theory that genetic inheritance is a primary determinant of human traits including intelligence, personality, and behavior.

Free Will

Free will refers to the belief that humans have the power to make choices that aren't predicated solely by biology or external forces.

Heredity

The genetic transmission of traits from parents to offspring.

Predict

To declare or indicate in advance; especially, to foretell based on observation, experience, or scientific reasoning.