Company X Has Net Sales Revenue of $436,000,cost of Goods

question 45

Multiple Choice

Company X has net sales revenue of $436,000,cost of goods sold of $343,000,and net income of $3,000.If interest expense is $10,000 and income tax expense is $1,000,the times interest earned ratio is closest to:

• A) 1.4.
• B) 0.33.
• C) 1.3.
• D) 0.40.

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Definitions:

Liquidated Damages Provision

A contractual clause that determines the amount of damages payable if one of the parties breaches the agreement.

Penalty Provision

A clause in a contract or law that specifies a penalty for non-compliance or violation of its terms.

Non-Breaching Seller

A party in a contract that has not failed to fulfill any term of the agreement, in contrast to a breaching party who has failed to perform as promised.

Remedies

Remedies in legal terms refer to the means by which a right is enforced or the violation of a right is prevented, redressed, or compensated.