The Sherwill statement of consolidated income is as follows: Net sales $658 Other income 8 666 Costs
Question:
The Sherwill statement of consolidated income is as follows:
Net sales $658 Other income 8 666 Costs and expenses:
Cost of products sold 418 Selling, general, and administrative expenses 196 Interest 16 630 Income before income taxes and extraordinary charges 36 Income taxes 18 Income before extraordinary charge 18 Extraordinary charge—losses on tornado damage (net) 4 Net income $ 14 Note: Depreciation expense totals $200; operating lease payments total $150; and preferred dividends total
$50. Assume that 1/3 of operating lease payments is for interest.
Required
a. Compute the times interest earned.
b. Compute the fixed charge coverage.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Financial Reporting And Analysis Using Financial Accounting Information
ISBN: 9780324023534
8th Edition
Authors: Charles H Gibson
Question Posted: