Question
Lassiter Motors has a debt-equity ratio of 0.45 and total debt of$186,000. The firm's market-to-book ratio is 2.6. The earnings before interest and taxes is
Lassiter Motors has a debt-equity ratio of 0.45 and total debt of$186,000. The firm's market-to-book ratio is 2.6. The earnings before interest and taxes is $69,200, interest is $26,400, depreciation and amortization total $87,100, and the tax rate is 34 percent. What is the firm's EV to EBITDA ratio if the firm has $31,000 in cash?
A. 7.34
B. 7.87
C. 6.01
D. 6.38
E. 5.47
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Fundamentals of corporate finance
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
10th edition
978-1260013955, 78034639, 978-0078034633
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