Addai Company has provided the following comparative information: 20Y8 20Y7 20Y6 20Y5 20Y4
Net income $273,406 $367,976 $631,176 $884,000 $800,000
Interest expense 616,047 572,003 528,165 495,000 440,000
Income tax expense 31,749 53,560 106,720 160,000 200,000
Total assets (ending balance) 4,417,178 4,124,350 3,732,443 3,338,500 2,750,000
Total stockholders’ equity (ending balance) 3,706,557 3,433,152 3,065,176 2,434,000 1,550,000
Average total assets 4,270,764 3,928,396 3,535,472 3,044,250 2,475,000
Average total stockholders' equity 3,569,855 3,249,164 2,749,588 1,992,000 1,150,000
You have been asked to evaluate the historical performance of the company over the last five years.

Selected industry ratios have remained relatively steady at the following levels for the last five years:

20Y4–20Y8
Return on total assets 28%
Return on stockholders’ equity 18%
Times interest earned 2.7
Ratio of liabilities to stockholders’ equity 0.4