Question: Consider the following operating figures: Net sales ................ $1,079,143 Cost and deductions: Cost of sales ............. 792,755 Selling and administration ......... 264,566 Interest expense, net

Consider the following operating figures:
Net sales ................ $1,079,143
Cost and deductions:
Cost of sales ............. 792,755
Selling and administration ......... 264,566
Interest expense, net .......... 4,311
Income taxes ............. 5,059
1,066,691
$ 12,452
Note: Depreciation expense totals $40,000.

Required
a. Compute the times interest earned.
b. Compute the cash basis times interest earned.

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