The Debt to Equity Ratio and Times-Interest-Earned Ratio for Conway

Multiple Choice

The debt to equity ratio and times-interest-earned ratio for Conway Corporation for the last two years are as follows: $$\begin{array} { l r r } & 2011 & 2010 \\\text { Debt to equity } & .34 & .35 \\\text { Times-interest-earned } & 4.2 \times & 5.5 \times \end{array}$$
Which of the following conclusions could be made about Conway Corporation?

A) The company is less able to pay its interest costs in 2011.
B) The company is better able to pay its interest costs in 2011.
C) The company has more debt outstanding in 2011.
D) The company is less risky in 2011.