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The W.C. Pruett Corp. has $800,000 of interest-bearing debt outstanding, and it pays an annual interest rate of 11%. In addition, it has $600,000 of
The W.C. Pruett Corp. has $800,000 of interest-bearing debt outstanding, and it pays an annual interest rate of 11%. In addition, it has $600,000 of common equity on its balance sheet. It finances with only debt and common equity, so it has no preferred stock. Its annual sales are $4.32 million, its average tax rate is 25%, and its profit margin is 7%. What are its TIE ratio and its return on invested capital (ROIC)? Round your answers to two decimal places. TIE: 3.33 ROIC: -5.04 % Keller Corporation has $320,000 shares outstanding with $2,848,000 of common equity. The current market price per share is $18.70. What is Keller's Market/Book ratio? a. 8.9 b. 4.7 c. 2.9 d. 2.1 e. 1.2 Which of the following best describes the difference between the current ratio and the quick or acid test ratio? a. Only the current ratio includes inventory in current assets. b. The current ratio is a more precise calculation. C. The quick ratio subtracts current liabilities from current assets. d. The quick ratio includes only liquid assets, unlike the current ratio. e. The current ratio includes only assets expected to be converted to cash in the near future
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