Selected Balance Sheet and Income Statement Information from the Vegan's

Essay

Selected balance sheet and income statement information from the Vegan's Company for fiscal years 2018 through 2020 follows (Amounts in millions):
$\begin{array}{crrrrrr}\text { Period } & \begin{array}{r}\text { Current } \\\text { assets }\end{array} & \begin{array}{r}\text { Current } \\\text { liabilities }\end{array} & \begin{array}{c}\text { Pretax } \\\text { income }\end{array} & \begin{array}{r}\text { Interest } \\\text { expense }\end{array} & \begin{array}{r}\text { Total } \\\text { assets }\end{array} & \text { Equity } \\\hline 2020 & \$ 15,306 & \$ 9,912 & \$ 4,834 & \$ 732 & \$ 39,526 & \$ 17,110 \\2019 & 18,662 & 13,146 & 7,182 & 732 & 42,080 & 18,226 \\2018 & 16,130 & 11,092 & 6,186 & 783 & 39,360 & 17,544\end{array}$
a. Compute the times-interest-earned ratio for each year and discuss any trends.
b. What concerns about Vegan's ability to meet its interest obligations might creditors have? Explain.