The Information Related to Jazz Music Company Is Given Below

question 131

Essay

The information related to Jazz Music Company is given below:
$$\begin{array} { l l l } & \text { Year ended December } & \text { Year ended December } \\&31,2018&31,2019\\\hline \text { Net Income } & \$81,510& \$210,570 \\\text { Income Tax Expense } & 55,910 & 103,505 \\\text { Interest Expense } & 6,595 & 59,505 \\\end{array}$$
Calculate the times-interest-earned ratio for each year.Round all calculations to two decimal places.

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Definitions:

Divisional Income

The earnings generated by distinct business units or divisions within a corporation, used to assess their individual performance.

Service Department Expenses

Costs associated with departments that support the production or operation of a company but do not directly produce goods or services, such as maintenance and human resources.

DuPont Formula

A formula that breaks down Return on Equity into three components: operating efficiency, asset use efficiency, and financial leverage.

Profit Margin

A financial ratio indicating the percentage of revenue that exceeds the costs of goods sold, reflecting the efficiency of a company in generating profit.