Calculate the Times Interest Earned Ratio Using the Following Information

question 133

Multiple Choice

Calculate the times interest earned ratio using the following information. Sales = $1.5 million, cost of goods sold = $800,000, depreciation expense = $100,000, addition to retained earnings = $85,000, dividends per share = $1.2, tax rate = 30 percent, and number of shares of common stock outstanding = 100,000. Assume the firm has no preferred stock.

• A) 2.25 times
• B) 1.25 times
• C) 1.95 times
• D) 2.75 times

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Definitions:

Regional Averages

Statistical measures representing average values, prices, or conditions within a specific geographic region.

Series Interview

A selection process involving multiple rounds of interviews, with candidates meeting various stakeholders at different times.

Multiple Candidates

Referring to a situation where several individuals are considered or competing for something, such as a job position.

Interviewer

A person who asks questions and conducts the dialogue in an interview setting, often for the purpose of assessing qualifications of the interviewee.