[The Following Information Applies to the Questions Displayed Below

question 140

Multiple Choice

[The following information applies to the questions displayed below.]
Given below are comparative balance sheets and an income statement for Namekagon Corporation.

-Namekagon Corporation's interest coverage ratio for 2018 is:

• A)1.45.
• B)1.69.
• C)2.45.
• D)4.92.

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Definitions:

Margin of Safety

The difference between actual or anticipated sales and the break-even point.

Unit Selling Price

The pricing of individual units of goods or services that a business offers for sale.

Break-even Point

The financial state where total costs equal total revenues, implying that the business is neither making a profit nor a loss.

Operating Income

The profit earned from a company's core business operations, excluding deductions of interest and tax.