Atlantic's statement of Income is as follows (in million $): Net sales $658 Other Income 8. 666 Costs and expenses: Costs of product sold Selling, general, and administrative expenses Interest...

Required:
a) Compute the times-interest earned and give the interpretation.
b) Compute the fixed charge coverage and give the interpretation.

Extracted text: Atlantic's statement of Income is as follows (in million $): Net sales $658 Other Income 8. 666 Costs and expenses: Costs of product sold Selling, general, and administrative expenses Interest expenses 418 196 16 630 Income before income taxes and extraordinary charges 36 Income taxes 18 Income before extraordinary charges Extraordinary charges 18 4 Net income $14 Note: Operating lease payment $200 million and preferred dividend total $50 million. Marginal tax rate 50%