Shown here are condensed income statements for two different companies ( both are organized as LLCs and pay no income taxes).

Required: 

1. Compute times interest earned for Ellis Company. 

2. Compute times interest earned for Seidel Company. 

3. What happens to each company's net income if sales increase by 10%? 

4. What happens to each company's net income if sales increase by 40%? 

5. What happens to each company's net income if sales increase by 90%? 

6. What happens to each company's net income if sales decrease by 20%? 

7. What happens to each company's net income if sales decrease by 50%? 

8. What happens to each company's net income if sales decrease by 80%? Analysis Component: 

9. Comment on the results from parts 3 through 8 in relation to the fixed cost strategies of the two companies and the ratio values you computed in parts 1 and 2.