According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of compute

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According To The Producer Price Index Database Maintained By The Bureau Of Labor Statistics The Average Cost Of Compute 1 (89.83 KiB) Viewed 31 times

According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 3.8 percent between January and December 2016. Let's see whether these changes are reflected in the income statement of Computer Tycoon Inc. for the year ended December 31, 2016. Sales Revenue Cost of Goods Sold Gross Profit Selling, General, and Administrative Expenses Interest Expense Income before Income Tax Expense Income Tax Expense Net Income 2016 $112,000 66,000 46,000 37,200 620 8,180 2,000 $ 6,180 2015 $138,000 76,300 61,700 39,400 535 21,765 6,200 $ 15,565 Required: 1. Compute the times interest earned ratios for 2016 and 2015. (Round your answers to 1 decimal place.) Times Interest Earned 2015 2016 2. Does Computer Tycoon generate sufficient net income in both years (before taxes and interest) to cover the cost of debt financing? :O: Yes