Green Penguin Pencil Company has a total asset turnover ratio of 8.50x, net annual sales of $40 million, and operating expenses of $18 million (including depreciation and amortization). On its balance sheet and income statement, respectively, it reported total debt of $1.75 million on which it pays a 11% interest rate.

To analyze a companys financial leverage situation, you need to measure the firms debt management ratios. Based on the preceding information, what are the values for Green Penguin Pencils debt management ratios?

Ratio	Value
Debt ratio
Times-interest-earned ratio

The US tax structure influences a firms willingness to finance with debt. The tax structure more debt.