Companys interest coverage ratio is

Assignment Help Financial Management
Reference no: EM132004356

Suppose a company has earnings before taxes of $20 billion and its income tax is 35% of its earnings before taxes.

If the company has an interest expense of $2 billion, its interest coverage ratio is? Please show work on how you got your answer!

Reference no: EM132004356

Questions Cloud

Nominal annual rate of interest compounded monthly : The nominal annual rate of interest compounded monthly on this loan is 7.69%. You can afford to pay monthly $ 1591.19 CAD.
What is your profit if the exchange rate goes down : Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.2853 S$/US$. You have just placed an order.
Compute gross profit for the white and grey divisions : Rent expense for the year was $41,000. Compute gross profit for the White and Grey Divisions, respectively
Determine as many points as possible in today yield curve : Determine as many points as possible in today's yield curve (or term structure of interest rates).
Companys interest coverage ratio is : Suppose a company has earnings before taxes of $20 billion and its income tax is 35% of its earnings before
Considering new three-year expansion project : Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.58 million.
Determined the rate of return on investment : The Bottlebrush Company has income from operations of $95,940, Use the DuPont formula to determined the rate of return on investment
What was the market price : What was the accrued interest? What was the market price (quoted on the Wall Street Journal)?
What is the total interest paid if the interest per payment : What is the total interest paid if the interest per payment period is 3.8%?

Reviews

Write a Review

Financial Management Questions & Answers

  Verify the portfolio you construct is arbitrage portfolio

Determine whether there is an arbitrage opportunity. If there is, find an arbitrage portfolio. Verify the portfolio you construct is an arbitrage portfolio.

  The return is due to the exchange rate movement

Suppose you are a euro-based investor who just sold Microsoft shares that you had bought six months ago. You had invested €10,000 to buy Microsoft shares for $120 per share; the exchange rate was $1.55 per euro. How much of the return is due to the e..

  What will be its dividend payout ratio

Puckett Products is planning for $4.5 million in capital expenditures next year. Puckett's target capital structure consists of 50% debt and 50% equity. If net income next year is $2.8 million and Puckett follows a residual distribution policy with a..

  The firm return on equity

The firm's return on equity (ROE) is:

  Compute the future value in year

Compute the future value in year 9 of a $3,300 deposit in year 1, and another $2,800 deposit at the end of year 5 using a 9 percent interest rate.

  Why would public service organization need to measure income

Why would public service organizations need to measure income? Does the difficulty in determining the current value of an asset create a problem in determining the depreciation expense that should be charged for a year?

  The pre-tax salvage value of an asset is equal

The pre-tax salvage value of an asset is equal to the: A. book value if straight-line depreciation is used. B. book value if MACRS depreciation is used. C. market value minus the book value. D. book value minus the market value. E. market value.

  What is the required after-tax refunding investment outlay

Oxford Corp. is considering refunding a $30,000,000, annual payment, 12% coupon, 30-year bond issue that was issued 5 years ago. It has been amortizing $2 million of flotation costs on these bonds over their 30-year life. The new bonds would be issue..

  What is meant by risk aggregation and risk decomposition

What is meant by risk aggregation and risk decomposition? Which requires an in-depth understanding of individual risks? Which requires a detailed knowledge of the correlations between risks?

  The payments are made monthly

You take out a 4 year car loan for $18,000. The loan has a 4% annual interest rate. The payments are made monthly. What are the monthly payments?

  What is the value of this account in exactly one year

A couple invests $10,720.00 today in a money market fund that pays 7.00% per year. What is the value of this account in exactly one year?

  What is the terminal value of the machine

The allowable depreciation rate is 15% on a straight line basis. What is the terminal value of the machine.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd