EX 14-14 Number of times interest charges are earned

The following data were taken from recent annual reports of Southwest Airlines, which operates a low-fare airline service to over 50 cities in the United States.

Current Year

Preceding Year

Interest expense

$105,000,000

$69,000,000

Income before income tax

278,000,000

1,058,000

a. Determine the number of times interest charges were earned for the current and preceding years. Round to one decimal place.

b. What conclusions can you draw?

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