A firm has total interest charges of $10,000 per year, sates 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?
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A firm has total interest charges of $10,000 per year, sates 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?
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- 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?a. 16 timesb. 10 timesc. 7 timesd. 11 timese. 20 timesAssume that a farmer has $157,500 in total assets and 102,600 in total debt faces 20% income tax rate and 40% consumption rate. Further assume that the rate of return on assets is 19.5% what is the interest rate if the firm growth rate is 11.5%?A firm has a tax burden ratio of .75, a leverage ratio of 1.25, an interest burden of .6, and a return on sales of 10%. The firm generates $2.40 in sales per dollar of assets. What is the firm’s ROE?
- A firm is fully invested in commercial real estate. The commercial real estate it owns experienced a rate of return of 8% per year, but the equity holders of the firm earned 18% a year. If the firm's debt earns 2% a yeare, what is the firms debt ratio?A firm has a profit margin of 15% on sales of $20,000,000. If the firm has debt of $7,500,000, total assets of $22,500.00, and a after-tax interest cost on total debt of 5%, what is the firm's ROA?Find the WACC given the following information: A firm has a cost of equity of 8% and cost of debt of 6.5%. The debt - toequity ratio is 0.75. The tax rate is 15%.
- Assume that your firm has a return on assets of 14.7% , sales of $16,625,000, total assets of $4,750,000, a return on equity of 36.75%, an interest rate on total debt of 10 percent, and a tax rate of 40 percent. Given this information, determine the firm's basic earnings power. (Hint: you may need to work an income statement backwards to get EBIT, in which case you will need to determine the firm's net income or profit, as well as its interest expense on total debt.)An A firm has sales of $10 million, variable costs of $4 million, fixed expenses of $1.5 million, interest costs of $2 million, and a 30 percent average tax rate. a) Compute its DOL, DFL, and DCL. b) What will be the expected level of EBIT and net income if next year's sales rise 10 percent? c) What will be the expected level of EBIT and net income if next year's sales fall 20 percent?An all -equity firm reports a net profit margin of 12% on sales of $6 million. If the tax rate is 35%, what is the pretax profit?
- Assume that a farmer has $223,500 in Total Assets and $90,500 in Owner Equity, faces a 15% income tax rate, and a 20% consumption rate. Further, assume that the interest rate is 12.5%. What is the rate-of-return on assets if the growth rate is 10.5%?A firm has a tax burden ratio of 0.85, a leverage ratio of 1.5, an interest burden of 0.9, and a return on sales of 12%. The firm generates $2 in sales per dollar of assets. What is the firm's ROE? (Do not round intermediate calculations. Round your answer to 2 decimal place.) ROE %A firm has an ROE of 3%, a debt-to-equity ratio of .5, and a tax rate of 35% and pays an interest rate of 6% on its debt. What is its operating ROA?
