Consider this simplified balance sheet for Geomorph Trading: ?? ? Current assets $ 170 Current liabilities $ 95 ? Long-term asset
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Consider this simplified balance sheet for Geomorph Trading:
Current assets
$
170
Current liabilities
$
95
Long-term assets
570
Long-term debt
245
Other liabilities
140
Equity
260
$
740
$
740
a. What is the company’s debt-equity ratio? (Round your answer to 2 decimal places.)
b. What is the ratio of total long-term debt to total long-term capital? (Round your answer to 2 decimal places.)
c. What is its net working capital?
d. What is its current ratio? (Round your answer to 2 decimal places.)
#6
Lever Age pays an 10% rate of interest on $10.50 million of outstanding debt with face value $10.5 million. The firm’s EBIT was $1.5 million.
a. What is its times interest earned? (Round your answer to 2 decimal places.)
b. If depreciation is $250,000, what is its cash coverage ratio? (Round your answer to 2 decimal places.)
#5
Consider this simplified balance sheet for Geomorph Trading:
|
|
|
|
|
|
|
|
|
|
Current assets |
$ |
170 |
|
Current liabilities |
$ |
95 |
|
|
Long-term assets |
|
570 |
|
Long-term debt |
|
245 |
|
|
|
|
|
|
Other liabilities |
|
140 |
|
|
|
|
|
|
Equity |
|
260 |
|
|
|
$ |
740 |
|
|
$ |
740 |
|
a. What is the company’s debt-equity ratio? (Round your answer to 2 decimal places.)
b. What is the ratio of total long-term debt to total long-term capital? (Round your answer to 2 decimal places.)
c. What is its net working capital?
d. What is its current ratio? (Round your answer to 2 decimal places.)
#6
Lever Age pays an 10% rate of interest on $10.50 million of outstanding debt with face value $10.5 million. The firm’s EBIT was $1.5 million.
a. What is its times interest earned? (Round your answer to 2 decimal places.)
b. If depreciation is $250,000, what is its cash coverage ratio? (Round your answer to 2 decimal places.)
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