Balance Sheet and Income Statement Data Indicate the Following: Bonds

Balance sheet and income statement data indicate the following: Bonds payable, 6% due in 15 years) Preferred 8% stock, $100 par no change during the year) $1,200,000
200,000
Common stock, $50 par
No change during the year) 1,000,000
Income before income tax for year
320,000
Income tax for year
80,000
Common dividends paid
60,000
Preferred dividends paid
16,000
Based on the data presented above, what is the number of times bond interest charges were earned round to two decimal places) ?

A) 5.00
B) 5.44
C) 4.00
D) 4.33

Correct Answer:

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