Selected financial data of Alexander Corporation for the year ended December 31,

Question

Selected financial data of Alexander Corporation for the year ended December 31, 2011, is presented below:

Operating income ...................................... $900,000
Interest expense ...................................... (100,000)
Income before income tax .............................. $800,000
Income tax expense .................................... (320,000)
Net income ............................................ $480,000
Preferred stock dividends ............................. (200,000)
Net income available to common stockholders ........... $280,000

Common stock dividends were $120,000. The times-interest-earned ratio is
a. 2.8 to 1.
b. 4.8 to 1.
c. 6.0 to 1.
d. 9.0 to 1.

Explanation / Answer

4.8 to 1.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.