Dehne Corporation Has Provided the Following Data from Its Most

question 132

Essay

Dehne Corporation has provided the following data from its most recent income statement:
$\begin{array}{l}\text {Net operating income }&\$ 75,000 \\\text { Interest expense. }&\$ 32,000 \\\text {Net income before taxes }&\$ 43,000 \\\text {Income taxes. }&\$ 13,000 \\\text { Net income.}&\$ 30,000\end{array}$
Required:
Compute the times interest earned ratio.Show your work!

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Definitions:

Depreciation Purposes

The allocation of the cost of an asset over its useful life for accounting and tax purposes.

Consolidation Worksheet

A tool used in accounting to combine the financial statements of a parent company with those of its subsidiaries, enabling a clearer overall financial picture.

Equity Method

An accounting technique used by companies to assess the profits earned by their investments in other companies, reflecting the profit share in their income statements.

Land Transfer

The process of transferring ownership of land from one party to another through sale, gift, or inheritance.