S9-14. (Learning Objective 4: Computing the times-interest-earned ratio) Kermit Plumbing Products Ltd. reported the following data in 20X0 (in billions):

Compute Kermit’s times-interest-earned ratio, and write a sentence to explain what the ratio value means. Would you be willing to lend Kermit $1 billion? State your reason.

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20X0 Net operating revenues... $29.8 Operating expenses 24.6 Operating income.. 5.2 Non-operating items: Interest expense. Other ......... Net income...... (1.6) (0.2) $ 3.4