Question
Times interest earned Loomis, Inc. reported the following on the companys income statement in two recent years: Current Year Prior Year Interest expense $480,000 $576,000
Times interest earned
Loomis, Inc. reported the following on the companys income statement in two recent years:
| Current Year | Prior Year | |||
| Interest expense | $480,000 | $576,000 | ||
| Income before income tax expense | 7,056,000 | 8,236,800 | ||
a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place.
| Current year | |
| Prior year |
b. Is the number of times interest charges are earned improving or declining?
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Auditing And Assurance Services An Integrated Approach
Authors: Alvin A. Arens, Randal J. Elder, Mark S. Beasley
10th Edition
0131457349, 978-0131457348
