Sugar, Inc. reported the following on its most recent income statement:   Earnings before Income Taxes $900,000 Income tax expense 225,000 Earnings after tax $675,000   An analysis of the income statement revealed that interest expense was $180,000. Sugar's times interest earned was Group of answer choices 8.5 times 10 times 7 times 4 times 5 times 7.5 times 11 times 6 times

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter6: Accounting For Financial Management
Section: Chapter Questions
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51

Sugar, Inc. reported the following on its most recent income statement:

 

Earnings before Income Taxes

$900,000

Income tax expense

225,000

Earnings after tax

$675,000

 

An analysis of the income statement revealed that interest expense was $180,000. Sugar's times interest earned was

Group of answer choices
8.5 times
10 times
7 times
4 times
5 times
7.5 times
11 times
6 times
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