Times interest earned Obj. 4 Averill Products Inc. reported the following on the company’s income statement in 20Y8 and 20Y9:

20Y9 20Y8 Interest expense $ 440,000 $ 400,000 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?

AppendixLO1