Averill Products Inc. reported the following on the companys income statement in 20Y8 and 20Y9: a. Determine

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Averill Products Inc. reported the following on the company’s income statement in 20Y8 and 20Y9:

20Y9 20Y8 $ 440,000 $ 400,000 Interest expense Income before income tax expense 5,544,000 4,400,000

a. Determine the times interest earned ratio for 20Y8 and 20Y9. Round to one decimal place.

b. Is the change in the times interest earned ratio favorable or unfavorable?

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Corporate Financial Accounting

ISBN: 9781337398169

15th Edition

Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac

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Question Posted: Sep 14, 2020 05:43 AM

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Averill Products Inc. reported the following on the companys income statement in 20Y8 and 20Y9: a. Determine

Question:

20Y9 20Y8 $ 440,000 $ 400,000 Interest expense Income before income tax expense 5,544,000 4,400,000

Step by Step Answer:

b Yes there is a favorable change in time interest earned ratio As there is a decrease in Times I...View the full answer

Corporate Financial Accounting

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