The Karson Transport Company currently has net operating income of $$$$508,000$ and pays interest expense of $$$$195,000.$ The company plans to borrow $$$$1\mathrm{.}15$ million on which the firm will pay $10$ percent interest. The borrowed money will be used to finance an investment that is expected to increase the$$ firm's net operating income by $ $405,000$ a year.

a$.$ What is Karson$\text{'}$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?

c$.$ If the$$ firm's estimates of the effect of the new investment work out as$$ planned, do the changes have a positive effect on the$$ firm's financial$$ condition? Question content area bottom

Part $1$ a$.$ What is Karson$\text{'}$s times interest earned ratio before the loan is taken out and the investment is$$ made? The times interest earned ratio is enter your response here times.