Given the Following Data, Determine the Times Interest Earned Ratio

question 183

Short Answer

Given the following data, determine the times interest earned ratio.
Net income - $70,000
Bonds Payable (issued at face value), 8% - $5,000,000
Preferred Stock ($50 par value, 6%, 10,000 shares issued & outstanding)
Tax rate - 30%

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Definitions:

Company's Management

Individuals responsible for directing and controlling a company's operations and policies to achieve its business objectives.

Auditors

Professionals who examine and verify a company's financial records and statements for accuracy and adherence to accounting standards.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, ending with net income or loss.

Statement of Cash Flows

A financial report that provides a summary of a company's cash inflows and outflows over a specified period.