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(Debt service ratios) A firm reported EBIT of $85,000 last year. The firm paid interest of $25,000 and repaid $15,000 of debt principal. The firm

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(Debt service ratios) A firm reported EBIT of $85,000 last year. The firm paid interest of $25,000 and repaid $15,000 of debt principal. The firm is in the 35% fed- eral income tax bracket. Calculate the following ratios for this firm: a. Times interest earned b. Fixed charge coverage 21

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