Answered: Thomson Trucking has $16 billion in…

Thomson Trucking has $16 billion in assets, and its tax rate is 40%.Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 5%. What is itstimes-interest-earned (TIE) ratio?

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter7: Corporate Valuation And Stock Valuation

Section: Chapter Questions

Problem 1P: Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1...

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Question

Thomson Trucking has $16 billion in assets, and its tax rate is 40%.
Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 5%. What is its
times-interest-earned (TIE) ratio?

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