1) A firm has total interest charges of $10,000 per year, sales of $1 million, a tax rate of 40
percent, and a net profit margin of 6 percent. What is the firm's times-interest-earned ratio?
Time Interest Earned Ratio+ Income before Interest and Taxes/ In
1) Zico Corporation recently reported that its earnings per share were $3.00.
The company has 400,000 shares of stock outstanding. The companys
interest expense was $500,000.
The corporate tax rate is 40 percent.
What was the companys operating income (EB
1) Last year Kidjan Company (KC) had $295,000 of assets, $18,750 of net income, and a debtto-total-assets ratio of 37%. Now suppose the new CEO convinces the president to increase
the debt ratio to 48%. Sales and total assets will not be affected, but int
1) Prague Manufacturing Company (PMC) has $20 million in total invested operating capital,
and its WACC is 10%. PMC has the following income statement:
Operating income (EBIT)
Earnings before taxes (EBT)