Creek Enterprises Income Statement for the Year Ended December 31, 2019 Sales revenue $29,951,000 Less: Cost of goods sold 20,973,000 Gross profits $8,978,000 Less: Operating expenses Selling expense $2,999,000 General and administrative expenses 1,821,000 Lease expense 203,000 Depreciation expense 985,000 Total operating expense 6,008,000 Operating profits $2,970,000 Less: Interest expense 1,027,000 Net profits before taxes $1,943,000 Less: Taxes (rate=21%) 408,030 Net profits after taxes $1,534,970 Less: Preferred stock dividends 104,125 Earnings available for common stockholders $1,430,845

Creek Enterprises Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Current assets Current liabilities Cash $977,000 Accounts payable $7,998,000 Marketable securities 3,030,000 Notes payable 8,029,000 Accounts receivable 11,963,000 Accruals 465,000 Inventories 7,454,000 Total current liabilities $16,492,000 Total current assets $23,424,000 Long-term debt (includes financial leases)** $19,031,000 Gross fixed assets (at cost)* Stockholders' equity Land and buildings $11,016,000 Preferred stock (24,500 shares, $4.25 dividend) $2,518,000 Machinery and equipment 20,508,000 Common stock (1.12 million Furniture and fixtures 7,960,000 shares at $5.25 par) 5,880,000 Gross fixed assets $39,484,000 Paid-in capital in excess of par value 3,983,000 Less: Accumulated depreciation 13,007,000 Retained earnings 1,997,000 Net fixed assets $26,477,000 Total stockholders' equity $14,378,000 Total liabilities and Total assets 49,901,000 stockholders' equity $49,901,000 *The firm has a 4-year financial lease requiring annual beginning-of-year payments of $203,000. Three years of the lease have yet to run. **Required annual principal payments are $791,000.

I need help finding the fixed-payment coverage ratio. The answer is already solved above just show me how to get that answer.

Debt analysis Springfield Bank is evaluating Creek Enterprises, which has requested a $4,410,000 loan, to assess the firm's financial leverage and financial risk. On the basis of the debt ratios for Creek, along with the industry averages and Creek's recent financial statements, evaluate and recommend appropriate action on the loan request Industry averages Creek Enterprises Income Statement: Debt ratio 0.50 Times interest earned ratio 7.15 Creek Enterprises Balance Sheet: Fixed-payment coverage ratio 1.97 Creek Enterprises's debt ratio is 70. (Round to two decimal places.) Creek Enterprises's times interest earned ratio is 2.89. (Round to two decimal places.) Creek Enterprises's fixed-payment coverage ratio is 1.34 (Round to two decimal places.) Complete the following summary of ratios and compare Creek Enterprises's ratios vs. the industry average: (Round to two decimal places.)