Analyze Abercrombie & Fitch Abercrombie & Fitch (ANF) is a leading, global specialty retailer of casual apparel. The income before income tax expense and interest expense for four recent years follow (in thousands): Year 4 Year 3 Year 2 Year 1 Income (loss) before income tax expense $116,367 $55,161 $(3,478) $54,590 Interest expense 18,248 a. Compute the times interest earned ratio for each year. Round your answers to one decimal place. 10,999 16,889 18,666 Times interest earned b. Interpret the trend in the ratio. Year 4 Year 3 Year 2 Year 1 a. While the times interest earned ratio is unfavorable in Year 2, there is a positive trend in Years 3 and 4. b. The decreasing interest expense and increasing pretax income leads to the improvement in the times interest earned ratio. This positive trend is good news for investors. c. While the times interest earned ratio is favorable in Year 2, there is a negative trend in Years 3 and 4. d. The increasing interest expense and decreasing pretax income leads to the improvement in the times interest earned ratio. This positive trend is good news for investors. c. What happened to interest expense in Year 47 What might be the cause? While interest expense) income. This may be cause by stable between Years 1 and 2, the in the ratio must have been caused by t sales as well as expenses between Years 1 and 2.