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Ontario Appliances Has the Following Data What Is the Interest Coverage for Ontario Appliances in 2X13

Question 61

Multiple Choice

Ontario Appliances has the following data: 2X132X12 Sales $930$700 Less: Cost of Goods Sold 410235 Gross Profit 520465 Less: Operating Expenses 260231 Operating Income 260234 Less: Other Expense: Interest Expense (30) (30)  Income before Tax 230204 Less: Income Tax Expense 9282 Net Income $138$122\begin{array}{llc}&2X13&2X12\\\text { Sales } & \$ 930 & \$ 700 \\\text { Less: Cost of Goods Sold } & \underline{410} & \underline{235} \\\text { Gross Profit } & 520 & 465 \\\text { Less: Operating Expenses } & \underline{260} & \underline{231} \\\text { Operating Income } & 260&234 \\\text { Less: Other Expense: Interest Expense } & \underline{(30) } & \underline{(30) } \\\text { Income before Tax } &230&204 \\\text { Less: Income Tax Expense } &\underline{92} & \underline{82} \\\text { Net Income }& \$ 138 & \$ 122\end{array} What is the interest coverage for Ontario Appliances in 2X13? Has the interest coverage improved or not improved since 2X12?


A) 12.7,unknown
B) 7.7,not improved
C) 7.7,improved
D) 8.7,improved
E) 8.7,not improved

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