Use the Table for the Question(s)below

question 34

Multiple Choice

Use the table for the question(s) below.
Consider the following income statement and other information:

-Luther's EBIT coverage ratio for the year ending December 31, 2012 is closest to:

• A)1.64
• B)1.78
• C)1.98
• D)2.19

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Definitions:

Elastic

Describes a situation where the quantity demanded or supplied of a good or service is sensitive to changes in price.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Price Taker

An entity that accepts market prices as given, without having influence to change the price by its own actions.

Buyer

An individual or entity that purchases goods or services for personal use or ownership rather than for reselling or producing other goods and services.