× The Lar o a l ezto.mheducation.com/hm.tpx Connect INANCE Chapter 3 Qutz 5. 200

Question

× The Lar o a l ezto.mheducation.com/hm.tpx Connect INANCE Chapter 3 Qutz 5. 200 points The Lancaster Corporation's income statement is given below LANCASTER CORPORA $ 231,000 116,000 Sales Cost of goods sold Gross proft Fixed charges (other than interest) Income before interest and taxes interest income before taxes Taxes (35%) S 115,000 29,700 S 85,300 15,900 24290 S 45,110 Income after taxes a. What is the times-interest-eamed ratio? (Round your answer to 2 decimal places.) Times interest eamedtimes be the fixed-charge-coverage ratio? (Round your answer to 2 decimal places.) Fioxed charge coverage times

Explanation / Answer

Times Interest Earned ratio= Income before Interest and Tax/Interest Expense Times Interest Earned ratio= 85300/15900 Times Interest Earned ratio=                                                                                   5.36 Fixed charge coverage ratio= Gross pRofit/(Fixed charge + interest expense) Fixed charge coverage ratio= 115000/(29700 + 15900) Fixed charge coverage ratio=                                                                                   2.52

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

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