The Lancaster Corporation's income statement is given below.SalesCost of goods soldGross profitFixed charges (other than interest)Income before interest and taxesLANCASTER CORPORATIONInterestIncome before taxesTaxes (35%)Income after taxesa. What is the times-interest-earned ratio?Note: Round your answer to 2 decimal places.Times interest earnedFixed charge coveragetimesb. What would be the fixed-charge-coverage ratio?Note: Round your answer to 2 decimal places.times$ 234,000175,000$ 59,00033,000$ 26,00017,300$ 8,7003,045$ 5,655

1.Times interest earned ratio = 2. Fixed charge coverage ratio =

Answered: The Lancaster Corporation's income…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Please do not give salutations in image format
Refer to the following selected financial information from Gomez Electronics. Compute the company's profit margin for Year 2. Net sales Cost of goods sold Interest expense Net income before tax Net income after tax Total assets Total liabilities Total equity Year 2 Year 1 $485,000 $427,550 277,600 251,420 11,000 12,000 68,550 53,980 47,350 41, 200 319,700 295,800 174,900 144, 800 168, 600 127, 200
Following is an incomplete current-year income statement. Determine Net Sales, Cost of goods sold and Net Income. Additional information follows: Return on total assets is 16% (average total assets is $62,500). Inventory turnover is 5 (average inventory is $7,800). Accounts receivable turnover is 8 (average accounts receivable is $7,700). Income Statement Net Sales Cost of goods sold Selling, general, and administrative expenses 8800 Income tax expenses 3800 Net Income
Webby Corporation reported the following amounts on its income statement: service revenues, S32,500; utilities expense, $300; net income, $1,600; and income tax expense, $900. If the only other amount reported on the income statement was for selling expenses, what amount would it be? a. $2,200 c. $30,000 b. $29,700 d. $30,900
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Required:a) Compute the times-interest earned and give the interpretation.b) Compute the fixed charge coverage and give the interpretation.

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