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The Simmons Corporation's income statement is given below. SIMMONS CORPORATION Sales Cost of goods sold Gross profit Fixed charges (other than interest) Income before interest and taxes Interest Income before taxes Taxes Income after taxes $231,000 116,000 X 115,000 29,700 85,300 15,900 69,400 24,290 $45,110 a. What is the times interest earned ratio? (Round the final answer to 2 decimal places.) Times interest earned b. What would be the fixed charge coverage ratio? (Round the final answer to 2 decimal places.) Fixed charge coverage

The Simmons Corporation's income statement is given below. SIMMONS CORPORATION Sales Cost of goods sold Gross profit Fixed charges (other than interest) Income before interest and taxes Interest Income before taxes Taxes Income after taxes $231,000 116,000 X 115,000 29,700 85,300 15,900 69,400 24,290 $45,110 a. What is the times interest earned ratio? (Round the final answer to 2 decimal places.) Times interest earned b. What would be the fixed charge coverage ratio? (Round the final answer to 2 decimal places.) Fixed charge coverage

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The Simmons Corporation's income statement is given below. SIMMONS CORPORATION Sales Cost of goods sold Gross profit Fixed charges (other than interest) Income before interest and taxes Interest Income before taxes Taxes Income after taxes X $231,000 116,000 115,000 29,700 X 85,300 15,900 a. What is the times interest earned ratio? (Round the final answer to 2 decimal places.) Times interest earned 69,400 24,290 $45,110 b. What would be the fixed charge coverage ratio? (Round the final answer to 2 decimal places.) Fixed charge coverage
Transcribed Image Text:The Simmons Corporation's income statement is given below. SIMMONS CORPORATION Sales Cost of goods sold Gross profit Fixed charges (other than interest) Income before interest and taxes Interest Income before taxes Taxes Income after taxes X $231,000 116,000 115,000 29,700 X 85,300 15,900 a. What is the times interest earned ratio? (Round the final answer to 2 decimal places.) Times interest earned 69,400 24,290 $45,110 b. What would be the fixed charge coverage ratio? (Round the final answer to 2 decimal places.) Fixed charge coverage
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