What was book debt-to-value ratio

Assignment Help Financial Management

Reference no: EM13935107

In 2013 Caterpillar Inc. had about 654 million shares outstanding. Their book value was $33 per share, and the market price was $86.50 per share. The company’s balance sheet shows that the company had $19.7 billion of long-term debt, which was currently selling near par value.

a. What was Caterpillar’s book debt-to-value ratio? (Enter your answer as a decimal rounded to 2 decimal places. Do not round intermediate calculations.)

Book value

b. What was its market debt-to-value ratio? (Enter your answer as a decimal rounded to 2 decimal places. Do not round intermediate calculations.)

Market value

Reference no: EM13935107

Questions Cloud

What is the breakeven point in dollar sales : The Poseidon Swim Company Produces swim trunks. The average selling price for one of their is $32.97. The variable cost per unit is $23.68, has an average fixed cost per year of $31,292. What is the breakeven point in dollar sales?

Indifferent between accepting project and not accepting : Your firm is contemplating the purchase of a new $595,000 computer-based order entry system. The system will be depreciated straight-line to zero over its five-year life. It will be worth $63,000 at the end of that time. At what level of pretax cost ..

A preisedefinition of globalization is difficult : A preisedefinition of globalization is difficult, because globalization is a processwhich removes economic, social and cultural boundaries of nation states.Discuss this process. Do you think that globalization is a win-win situationfor all countries?..

What is the minimum number of shares : The shareholders of the Pickwick Paper Company need to elect eight directors. There are 200,000 shares outstanding. What is the minimum number of shares you need to own to ensure that you can elect at least one director if the company has majority vo..

What was book debt-to-value ratio : In 2013 Caterpillar Inc. had about 654 million shares outstanding. Their book value was $33 per share, and the market price was $86.50 per share. The company’s balance sheet shows that the company had $19.7 billion of long-term debt, which was curren..

Identify each of the following statements : Identify each of the following statements with fixed costs or variable costs by writing fixed or variable in the space provided.

Existence of just four large cpa firms-service virtually : The existence of just four large CPA firms that service virtually all of the major industrial and financial companies and thus dominate the accounting profession has led to criticism through the years. What dangers do you see from the dominance of a ..

What is the return on debt : Marten Corp has a 14% WACC with a 19% expected return on equity and a 60% debt-to-asset ratio. If Marten pays no income tax, what is the return on debt? If the debt-to-asset ratio increases to 80%, now what is Marten’s WACC?

Substantial dividend or repurchase shares of stock : Residential Inc. produced substantial profits in the previous year. Assume that Residential pays 35% corporate income tax. If investors are taxed at 25% on ordinary income, and have 0% capital gains tax, would Residential’s common stock investors pre..

User Account

All Pages