Company A has three debt issues of $3,000 each. The interest rate upon issue A is 4 percent, on B the rate is 6 percent, and on C the rate is 8 percent. Issue B is subordinate to A, and issue C is subordinate to both A and B. The firm's operating income (EBIT) is $500.
A. Calculate the times-interest-earned ratio for issue C.
B. What does the answer imply?
C. Does the answer mean that the interest will not be paid?