Tasker Inc

Multiple Choice

Tasker Inc. earned a gross profit of $300,000 on sales of $1,200,000 during 2013. The company also had operating expenses of $180,000. These operating expenses included interest expense of $40,000. The company is subject to an effective tax rate of 30%. What is the company's times interest earned ratio for the year?

A) 4.5 times
B) 4 times
C) 5 times
D) 3.2 times