Question
The Lancaster Corporations income statement is given below. LANCASTER CORPORATION Sales $ 233,000 Cost of goods sold 137,000 Gross profit $ 96,000 Fixed charges (other
The Lancaster Corporations income statement is given below.
| LANCASTER CORPORATION | ||
| Sales | $ | 233,000 |
| Cost of goods sold | 137,000 | |
| Gross profit | $ | 96,000 |
| Fixed charges (other than interest) | 31,800 | |
| Income before interest and taxes | $ | 64,200 |
| Interest | 19,800 | |
| Income before taxes | $ | 44,400 |
| Taxes (35%) | 15,540 | |
| Income after taxes | $ | 28,860 |
a. What is the times-interest-earned ratio? (Round your answer to 2 decimal places.)
b. What would be the fixed-charge-coverage ratio? (Round your answer to 2 decimal places.)
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Public Finance
Authors: Richard W. Tresch
4th Edition
0128228644, 978-0128228647
