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Here are some data for five companies in the same industry: Company Code A B C D E EBIT 28.00 68.00 208.00 14.00 246.00 Interest
Here are some data for five companies in the same industry:
Company Code | |||||
A | B | C | D | E | |
EBIT | 28.00 | 68.00 | 208.00 | 14.00 | 246.00 |
Interest expense | 7.00 | 17.00 | 52.00 | 4.00 | 3.00 |
a. Calculate a measure of times-interest-earned for the industry.
b. Calculate a measure of times-interest-earned for each company.
c. Calculate the average of the times-interest-earned ratios for the individual companies.
d. Does changing the method of calculation make a significant difference to the end result?
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