Last Year Boxer Corporation Had Net Income of $24,000, Income

question 81

Essay

Last year Boxer Corporation had net income of $24,000, income tax expense of $7,200 and interest expense of $2,000.What is Boxer's times interest earned ratio?

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Definitions:

Retained Earnings

The amount of net earnings remaining for the company after distributing dividends to its shareholders.

Shareholders' Equity

The ownership interest of shareholders in a company, calculated as the company's total assets minus its total liabilities.

Appropriations

The act of setting aside funds for a specific purpose, often used in government budgeting.

Contra-Asset

An account on a company's balance sheet that reduces the value of related, primary asset accounts.