Aslam Company Reported the Following on Its Income Statement for the Year-Ended

Multiple Choice

Aslam Company reported the following on its income statement for the year-ended June 30, 2014. $$\begin{array} { l r } \text { Earnings before income tax } & \$ 550,000 \\\text { Income tax expense } & \underline { 160,000 } \\\text { Net income } & \$ 390,000\end{array}$$ An analysis of the income statement revealed that interest expense was $60,000 for the year.What was Aslam's interest coverage ratio closest to?

A) 6.5 times
B) 9.2 times
C) 9.9 times
D) 10.2 times
($550,000 + $60,000) /$60,000 = 10.2 times