Response to the following problem:
The H. R. Pickett Corporation has $500,000 of debt outstanding, and it pays an interest rate of 10 percent annually: Pickett's annual sales are $2 million, its average tax rate is 30 percent, and its net profit margin on sales is 5 percent. If the company does not maintain a TIE ratio of at least 5 times, its bank will refuse to renew the loan, and bankruptcy will result. What is Pickett's TIE (Times interest earned) ratio?