The Times Interest Earned Ratio for Bodhaine's Orchard Was 8

question 170

Multiple Choice

The times interest earned ratio for Bodhaine's Orchard was 8.52 in 2016,6.63 in 2017,and 2.74 in 2018.What is the most likely interpretation of this ratio?

• A)The ability to cover interest costs with resources from operations is decreasing.
• B)The amount of debt has been decreasing each year.
• C)Current liabilities are growing faster than current assets.
• D)Income taxes have reduced an increasing amount of operating income.

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Definitions:

Customer Service

The assistance and support provided by a company to those people who buy or use its products or services.

Management Function

encompasses the processes or activities that managers perform to plan, organize, lead, and control operations within an organization to achieve specified objectives.

Management Team

A group of individuals who manage and make decisions for a specific area of a company or organization.

Organization Lies

Falsehoods or dishonest statements made by an organization, often to protect its interests or image.