The following data have been gathered from the financial statements of HiFly Corporation.

2015 2016

Operating profit $550,000,000 $600,000,000

Interest expenses $200,000,000 $250,0000,000

Taxes $126,000,000 $126,000,000

Net profit $ 224, 000, 000 $224,000,000

a. Calculate the times interest earned ratios for 2015 and 2016. Is the company more or less able to meet its interest payments in 2016 when measured this way?

b. Growth-Co had sales of $ 55 million in 2016 and is expected to have sales of $ 83, 650, 000 for 2017. The company's net profit margin was 5% in 2016 and is expected to increase to 8% by 2017, Estimate the company's net profit for 2017.

Answer rating: 100% (QA)

a Times Interest earned ratio Operating Profit Interest Expense ... View the full answer