IMG_4996

Question 1 A times-interest-earned ratio of 3.5 indicates that the firm has EBIT equal to 3.5 times its interest expense. pays 3.5 times its earnings in interest expense. has interest expense equal to 3.5% of EBIT. has interest expense equal to 3.5% of net income. Question 2 Across companies, ROA and financial leverage tend to be inversely related. true False Question 3 [The following information applies to the questions displayed below.] The financial statements for Limited Brands, Inc. follow (fiscal years ending January): [the> Please refer to Limited Brands, Inc.’s financial statements above. Prepare common-size financial statements for Limited Brands, Inc. for 2006-2007.