(Capitat structure analysis). The Karson Ttansport Company currently has net operating income of $506,000 and pays interest expense of $196,000 The company plans to borrow $1.13 milion on which the firm wil pay 11 percent interest The borrowed money will be used to finance an investment that is expected to increase the firms net operating income by $400,000 a year a. What is. Karson's times interest earned ratio before the loan is taken out and the investment is made? b. What effect will the loan and the investment have on the firm's times interest earned ratio