A company’s income before interest expense and income taxes in 2010 is $225,000 and $200,000 in 2011. Its interest expense was $45,000 for each year. Calculate the company’s times interest earned ratio for 2010 and 2011 and then comment on the level of risk. 2010: 2011: Comment on its level of risk.

A company’s income before interest expense and income taxes in 2010 is $225,000 and $200,000 in 2011. Its interest expense was $45,000 for each year. Calculate the company’s times interest earned ratio for 2010 and 2011 and then comment on the level of risk. 2010: 2011: Comment on its level of risk.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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