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Assume a company provided the following information: Net operating income $ 190,000 Net income before tax $ 170,000 Net income $ 119,000 Gross margin $

Assume a company provided the following information:

Net operating income $ 190,000
Net income before tax $ 170,000
Net income $ 119,000
Gross margin $ 680,000

The times interest earned ratio is closest to:

Multiple Choice

  • 6.16.

  • 9.50.

  • 6.80.

  • 5.16.

  • Assume a company provided the following excerpts from its balance sheet and income statement as shown below:

    Ending Balance Beginning Balance
    Current assets $ 120,000 $ 140,000
    Total assets $ 480,000 $ 380,000
    Current liabilities $ 72,000 $ 70,000
    Total liabilities $ 174,600 $ 174,000
    Total stockholders equity $ 305,400 $ 206,000

    Sales $ 1,000,000
    Cost of goods sold 600,000
    Gross margin 400,000
    Selling and administrative expenses 250,000
    Net operating income 150,000
    Interest expense 8,000
    Net income before taxes 142,000
    Income taxes 42,600
    Net income $ 99,400

    If the current assets at the end of the year include $40,000 of inventory and $5,000 of prepaid expenses, then the acid-test (quick) ratio at the end of the year is closest to:

    Multiple Choice

  • 1.04.

  • 1.17.

  • 1.24.

  • 0.96.

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