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Accounting
Question 29
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Selected data from Kamal Company's financial statements is as follows:
In $000's
2017
2016
Current liabilities
$ 5,130
$ 5,202
Long-term debt
1,419
1,322
Stockholders' equity
12,632
11,166
Interest and principal payments
300
400
Net income
2,430
2,280
Interest expense
196
172
Income taxes
1,837
1,524
Dividends paid
750
750
Kamal Company's times interest earned ratio for 2017
Select one:
A. increased, which indicates the company's creditors will be pleased.
B. indicates the company cannot meet its current year interest payments out of current year earnings.
C. decreased slightly, which indicates the company has about the same ability to pay interest on its debt.
D. shows an increase in the company's ability to make its interest payments.
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