According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 3.8 percent between January and December 2016. Lets see whether these changes are reflected in the income statement of Computer Tycoon Inc. for the year ended December 31, 2016. 2016 2015 Sales Revenue $ 105,000 $ 127,500 Cost of Goods Sold 62,500 73,500 Gross Profit 42,500 54,000 Selling, General, and Administrative Expenses 36,500 38,000 Interest Expense 550 500 Income before Income Tax Expense 5,450 15,500 Income Tax Expense 1,500 5,500 Net Income $ 3,950 $ 10,000 Required: Compute the times interest earned ratios for 2016 and 2015

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Times Interest Earned 2015 2016