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Use the Following Data to Answer the Question: What Are

Question 21

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Use the following data to answer the question: What are the three interest coverage ratios based on pretax income and interest expense? 20152016 Current assets $860$896 Current liabilities 710818 Debt in current liabilities 139 Lurkg-term debt 506408 Total assets 2,2932,307 Capilal experuditures 111117 Change in deferred taxes 2920 Sales 4,1004,192 Operating expenses 3,3073,260 Rental expense 0248 Gerieral expenses 562528 Depreciation 139136 Iriterest experise 3930 Incuere taxes 58\begin{array}{|l|l|l|} \hline& 2015 & 2016 \\\hline \text { Current assets } & \$ 860 & \$ 896 \\\hline \text { Current liabilities } & 710 & 818 \\\hline \text { Debt in current liabilities } & 1 & 39 \\\hline \text { Lurkg-term debt } & 506 & 408 \\\hline \text { Total assets } & 2,293 & 2,307 \\\hline \text { Capilal experuditures } & 111 & 117 \\\hline \text { Change in deferred taxes } & 29 & -20 \\\hline \text { Sales } & 4,100 & 4,192 \\\hline \text { Operating expenses } & 3,307 & 3,260 \\\hline \text { Rental expense } & 0 & 248 \\\hline \text { Gerieral expenses } & 562 & 528 \\\hline \text { Depreciation } & 139 & 136 \\\hline \text { Iriterest experise } & 39 & 30 \\\hline \text { Incuere taxes } & 5 & 8 \\\hline\end{array}


A) For 2016,interest coverage ratios based on EBIT,EBITDA,and EBITDAR are 5.47,5.47,and 1.48,respectively.
B) For 2016,interest coverage ratios based on EBIT,EBITDA,and EBITDAR are 2.36,5.92,and 13.73,respectively.
C) For 2016,interest coverage ratios based on EBIT,EBITDA,and EBITDAR are 0.93,5.47,and 1.48,respectively.
D) For 2016,interest coverage ratios based on EBIT,EBITDA,and EBITDAR are 0.93,5.47,and 13.73,respectively.

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