1. Lake Company reported the following on its income statement: Income before income taxes $600,000 Income tax expense 150,000 Net income $450,000 An analysis of the income statement revealed that interest expense was $60,000. Lake Company's times interest earned was how much? 2. Nord Company had $375,000 of current assets and $150,000 of current liabilities before borrowing $70,000 from the bank with a 3-month note payable. What effect did the borrowing transaction have on the amount of Nord Company's working capital? a. No effect b. $70,000 increase c. $140,000 increase d. $70,000 decrease 3. Nord Company had $375,000 of current assets and $150,000 of current liabilities before borrowing $70,000 from the bank with a 3-month note payable. What effect did the borrowing transaction have on Nord Company's current ratio? a. The ratio remained unchanged. b. The change in the current ratio cannot be determined. C. The ratio decreased. d. The ratio increased