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Unformatted text preview: Net Income + Interest + Taxes ÷ Interest = Times Interest Earned Ratio Expedia $538,159 ÷ $84,233 = 6.4 Priceline $560,724 ÷ $24,084 = 23.3 Priceline, with a times interest earned ratio of 23.3, is better able to meet interest payments as they become due than Expedia with a ratio of only 6.4. The soft drink industry represented by Coca-Cola and Pepsi have a times interest earned ratio similar to Priceline and far stronger than Expedia. Overall, the soft drink industry seems to have a slightly better times interest earned ratio....
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This note was uploaded on 02/27/2012 for the course MGMT 200 taught by Professor Greigg during the Spring '08 term at Purdue University.
- Spring '08