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The Morris corporation has $600,000 of debt outstanding and it pays an interest rate of 8% annually. Morris's annual sales are $3 million, its average

The Morris corporation has $600,000 of debt outstanding and it pays an interest rate of 8% annually. Morris's annual sales are $3 million, its average tax rate is 40% and its net profit margin on sales is 3%. If the company does not maintain a TIE ratio of at least 5 to 1, then its bank will refuse to renew the loan and bankruptcy will result. What is Morris's TIE ratio?

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