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1.00 points E13-5 Computing a Commonly Used Solvency Ratio [LO 13-4, 13-5] According to the producer price index database maintained by the Bureau of Labor
1.00 points E13-5 Computing a Commonly Used Solvency Ratio [LO 13-4, 13-5] According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 8.1 percant between 2012 and 2013. Let's see whether these changes are refected in the income statement of Computer Tycoon Inc. for the year ended December 31, 2013 2013 3109.000 133,500 2012 Saes Revenue Cost of Goods Sold Groos Prott Seling, General, and Administrative Expenses Interest Expense Income before Income Tax Expense Income Tax Expense 4,500 38,900 7010 9080 S 5.510 13.180 Required: 1. Compute the times interest caned ratios for 2013 and 2012. (Round your answers to 1 decimal place.) 2012 2013 2. Does Computer Tycoon generate sufficient net income (before taxes and interest) to cover the cost of debt financing? No
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