Question
Times interest earned Averill Products Inc. reported the following on the companys income statement in 20Y8 and 20Y9: 20Y9 20Y8 Interest expense $400,000 $360,000 Income
Times interest earned
Averill Products Inc. reported the following on the companys income statement in 20Y8 and 20Y9:
| 20Y9 | 20Y8 | |||
| Interest expense | $400,000 | $360,000 | ||
| Income before income tax expense | 5,360,000 | 4,140,000 | ||
a. Determine the times interest earned ratio for 20Y8 and 20Y9. Round to one decimal place.
| 20Y9 | 20Y8 | |||
| Times Interest Earned | fill in the blank 1 | fill in the blank 2 | ||
b. Is the change in the times interest earned ratio favorable or unfavorable?
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Standards On Auditing For Ca Students
Authors: Anshul Mittal
1st Edition
8182964962, 978-8182964969
