Times Interest Earned

Loomis, Inc., reported the following on the companys income statement in two recent years:

	Current Year		Prior Year
Interest expense	$329,000		$394,800
Income before income tax expense	4,540,200		5,250,840

Present value of bonds payable; premium
DATA
Face amount of bonds	$40,000,000
Contract rate of interest	11%
Term of bonds, years	4
Market rate of interest	8%
Interest payment	Semiannual
Using formulas and cell references, perform the required analysis, and input your answer into the Amount column. Transfer the numeric result for the green entry cell (B13) into the appropriate field in CNOWv2 for grading.

a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place.

Current year	fill in the blank 1
Prior year	fill in the blank 2

b. Is this ratio improving or declining?