Question
Lever Age pays a(n) 9% rate of interest on $11.0 million of outstanding debt with face value $11.0 million. The firms EBIT was $2.0 million.
| Lever Age pays a(n) 9% rate of interest on $11.0 million of outstanding debt with face value $11.0 million. The firms EBIT was $2.0 million. |
| a. | What is times interest earned? (Round your answer to 2 decimal places.) |
| Times interest earned |
| b. | If depreciation is $300,000, what is cash coverage? (Round your answer to 2 decimal places.) |
| Cash coverage |
| c. | If the firm must retire $400,000 of debt for the sinking fund each year, what is its fixed-payment cash-coverage ratio (the ratio of cash flow to interest plus other fixed debt payments)? (Round your answer to 2 decimal places.) |
| Fixed-payment cash-coverage ratio |
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Bucks The Next Step Advanced Medical Coding And Auditing
Authors: Elsevier
1st Edition
0323874118, 978-0323874113
