You are coming into work, as a credit analyst, you learn that one of the companies in your portfolio just announced they are taking a $$1,100,000$ goodwill write$-$off.

They must maintain a Total Assets to Total Liabilities ratio of $2\mathrm{.}0$ as part of their bond covenants. You are on the train and your assistant quickly sends you the following information. As you are nervously sweating to see if your company is in an event of default.

Total Assets $6,750,000$

Total Equity $4,250,000$

Is your company in an event of default

Yes $-$ Covenant Violated

A write$-$off does not violate bond covenants

No $-$ Covenant not violated

Not enough information is provided