The condensed income statements for years 20X1 and 20X2 for the Ruhf Inn are shown below:

20X1 20X2 Room revenue $2,500,000 $3,000,000 Room—labor costs 400,000 500,000 Room—other expenses 300,000 350,000 Room income 1,800,000 2,150,000 Undistributed operating expenses 500,000 600,000 Interest expense 200,000 250,000 Rent expense 100,000 120,000 Other fixed charges 400,000 400,000 Income before taxes 600,000 780,000 Income taxes 200,000 260,000 Net income $ 400,000 $ 520,000 Required:

1. Determine the following for each year:

Number of times interest earned ratio Fixed charge coverage ratio Profit margin Room labor cost percentage Sed re Average tax rate 2. Prepare a common-size income statement for 20X1 and 20X2 and com- ment on any significant differences in the percentages.