Coats Corp

Multiple Choice

Coats Corp.generates $10,000,000 in sales.Its variable costs equal 85% of sales and its fixed costs are $500,000.Therefore,the company's operating income (EBIT) equals $1,000,000.The company estimates that if its sales were to increase 9.5%,its net income and EPS would increase 17.5%.What is the company's interest expense?

A) $193,143
B) $176,429
C) $185,714
D) $202,429
E) $163,429