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I just want to make sure I got this correct. In 2016, Natural Selection, a nationwide computer dating service, had $526 million of assets and
I just want to make sure I got this correct.
In 2016, Natural Selection, a nationwide computer dating service, had $526 million of assets and $213 million of liabilities. Earnings before interest and taxes were $133 million, interest expense was $28.5 million, the tax rate was 40 percent, principal repayment requirements were $25.3 million, and annual dividends were 25 cents per share on 20 million shares outstanding. a. Calculate the following for Natural Selection: (Round your answers to 2 decimal places.) 0.68 Liabilities-to-equity ratio Times-interest-earned ratio Times burden covered 4.67 1.88 b. What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover: (Round your answers to 1 decimal place.) Interest payment requirements? Principal and interest requirements? Principal, interest, and common dividend payments? 78.6% 46.8% 40.6%Step by Step Solution
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