Balance Sheet Assets: Cash and marketable securities $600,000
Accounts receivable $900,000
Inventories $1,500,000
Prepaid expenses $75,000
Total current assets $3,075,000
Fixed assets $8,000,000
Less: accumulated depreciation $2,075,000
Net fixed assets $5,925,000
Total assets $9,000,000
Income statement Net sales (all credit) $10,000,000
Cost of goods sold $3,000,000
Selling and administrative expense $2,000,000
Depreciation expense $250,000
Interest expense $200,000
Earnings before taxes $4,550,000
Income taxes $1,820,000
Net income $2,730,000
Common stock shares outstanding 1,000,000
Market price $30.00
Liabilities: Accounts payable $800,000
Notes payable $700,000
Accrued taxes $50,000
Total current liabilities $1,550,000
Long-term debt $2,500,000
Owners equity (1 million shares of common stock outstanding) $4,950,000
Total liabilities and owner's equity $9,000,000
Based on the information in the above table, the times interest earned is:
