The income statements for Home Depot, Inc. (HD), spanning the period 20142016 (just before the housing crash, so these are representative years) are as follows:

a. Calculate the times interest earned ratio for each of the years for which you have data.

b. What is your assessment of how the firms ability to service its debt obligations has changed over this period?

2016 2015 2014 $ thousands Net operating income (EBIT) Interest expense Earnings before taxes Income taxes Net income $11,774,000 (919,000) $11,021,000 (4,012,000) $7,009,000 $10,469,000 (830,000) $9,976,000 (3,631,000) $ 6,345,000 $9,166,000 (711,000) $8,467,000 (3,082,000) $5,385,000