Consolidated statement of earnings of anonymous corporation

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Reference no: EM131004109

The consolidated statement of earnings of Anonymous Corporation for the year ended December 31, 2007, is as follows:

Net sales

$1,550,010,000

Other  income, net

10,898,000

 

1,560,908,000

Costs and expenses: Cost of goods sold

1,237,403,000

Depreciation  and amortization

32,229,000

Selling, general, and administrative

178,850,000

Interest

37,646,000

 

1,486,128,000

Earnings from continuing operations  before income taxes and equity earnings

74,780,000

Income taxes

37,394,000

Earnings from continuing operations before equity earnings Equity in net earnings of unconsolidated subsidiaries and affiliated companies

37,386,000

27,749,000

Earnings from continuing  operations

Earnings (losses) from discontinued operations, net of applicable income  taxes

65,135,000

6,392,000

Net earnings

$71,527,000

Required:

a. Compute the times interest earned for  2007.

b. Compute the times interest earned for 2007, including the equity income in the coverage.

c. What is the impact of including equity earnings from the coverage? Why should equity income be excluded from the times interest earned coverage?

Reference no: EM131004109

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