Answer:
1. Times interest earned ratio is 4.72
2. Debt to equity ratio is 1.12. Option C
Explanation:
Current liabilities = $185 
Income before interest and taxes = $170 
10% Bonds, long-term = $360 
Interest expense = $36 
Total liabilities = $545 
Income before tax = $134 
Stockholders' equity Income tax = $29 
Common stock = $222 
Net income = $105 
Retained earnings = $289 
Total stockholders' equity = $511 
Total liabilities and equity = $1,056
1. Times interest earned ratio = Earnings before interest and taxes/Interest expenses
= $170 ÷ $36
= 4.72
Current liabilities = $180 
Income before interest and taxes = $118
10% Bonds, long-term = $360 
Interest expense = $36
Total liabilities = $540 
Income before tax = $82
Shareholders' equity Income tax = $20
Capital stock 201 Net income = $62
Retained earnings = $283
Total shareholders'equity = $484
Total liabilities and equity = $1,024
2. Debt to equity ratio = Total debt ÷ Total equity
= 540 ÷ 484
= 1.12