In the past year, TVG had revenues of $3.04 million, cost of goods sold of $2.54...

In the past year, TVG had revenues of $3.04 million, cost of goods sold of $2.54 million, and depreciation expense of $130,280. The firm has a single issue of debt outstanding with book value of $1.04 million on which it pays an interest rate of 9%. What is the firm’s times interest earned ratio? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Expert Solution

Times Interest Earned Ratio is 3.95

Working:

Times-Interest earned Ratio	=	EBIT	/	Interest
	=	$3,69,720	/	$93,600
	=	3.95

Working:

EBIT stands for Earning Before Interest aand Taxes.

EBIT is calculated as follows:

Revenues		$30,40,000
Cost of goods sold		$25,40,000
Gross Profit		$5,00,000
Depreciation		$1,30,280
EBIT		$3,69,720


Interest	=	Book Value of debt	*	Interest Rate
	=	$10,40,000	*	9%
	=	$93,600

jeff jeffy answered 2 years ago

For the past year, Coach, Inc., had a cost of goods sold of $68,382. At the...

For the past year, Coach, Inc., had a cost of goods sold of $68,382. At the end of the year, the accounts payable balance was $11,889. How long on average did it take the company to pay off its suppliers during the year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Days’ sales in payables days

For the past year, Coach, Inc., had a cost of goods sold of $59,882. At the...

For the past year, Coach, Inc., had a cost of goods sold of $59,882. At the end of the year, the accounts payable balance was $13,589. How long on average did it take the company to pay off its suppliers during the year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Days’ sales in payables days

Butterfly Tractors had $17.50 million in sales last year. Cost of goods sold was $8.70 million,...

Butterfly Tractors had $17.50 million in sales last year. Cost of goods sold was $8.70 million, depreciation expense was $2.70 million, interest payment on outstanding debt was $1.70million, and the firm’s tax rate was 30%. a. What was the firm’s net income? (Enter your answers in millions rounded to 2 decimal places.) b. What was the firm’s cash flow? (Enter your answers in millions rounded to 2 decimal places.) c. What would happen to net income and cash flow if...

Butterfly Tractors had $21.50 million in sales last year. Cost of goods sold was $9.50 million,...

Butterfly Tractors had $21.50 million in sales last year. Cost of goods sold was $9.50 million, depreciation expense was $3.50 million, interest payment on outstanding debt was $2.50 million, and the firm’s tax rate was 30%. a. What was the firm’s net income and net cash flow? (Enter your answers in millions rounded to 2 decimal places. For example, for $3.92 million, enter "3.92", not "3920000") Net income $ million Net cash flow $ million b. What would happen to net income...

Butterfly Tractors had $15.00 million in sales last year. Cost of goods sold was $8.20 million,...

Butterfly Tractors had $15.00 million in sales last year. Cost of goods sold was $8.20 million, depreciation expense was $2.20 million, interest payment on outstanding debt was $1.20 million, and the firm’s tax rate was 21%. a. What was the firm’s net income? (Enter your answers in millions rounded to 2 decimal places.) b. What was the firm’s cash flow? (Enter your answers in millions rounded to 2 decimal places.) c. What would happen to net income and cash flow...

Premium Excavators had $14 million in sales last year. Cost of goods sold was $8 million,...

Premium Excavators had $14 million in sales last year. Cost of goods sold was $8 million, depreciation expense was $2 million, interest payments on outstanding debt was $1 million, and the firm’s tax rate was 21%. What was the firm’s net income? What was the firm’s cash flow? What would happen to net income and cash flow if depreciation were increased by $1 million? Would you expect the change in depreciation o have a positive or negative impact on the...

Eagle Corporation had $10 Million in Sales last year. Cost of goods sold were $6 Million,...

Eagle Corporation had $10 Million in Sales last year. Cost of goods sold were $6 Million, depreciation expense was $1 Million, interest payment on outstanding debt was $2 Million, and the firm’s tax rate is 35%. What was Eagle Corporation’s Net Income (after tax)? What was Eagle Corporation’s Net Cash Flow? (1 point) What would happen to Net Income and Cash Flow if Depreciation increased by $1 Million? What would happen to Net Income and Cash Flow is the Depreciation...

The Greek Connection had sales of $ 29.9 million and a cost of goods sold of...

The Greek Connection had sales of $ 29.9 million and a cost of goods sold of $ 12.0 million in 2013. A simplified balance sheet for the firm appears? below: a. Calculate The Greek? Connection's net working capital in 2013. b. Calculate the cash conversion cycle of The Greek Connection in 2013. c. The industry average accounts receivable days is 30 days. What would have been the cash conversion cycle for The Greek Connection in 2013 had it met the...

For the past year, Coach, Inc., had a cost of goods sold of $87,386. At the end of the year, the accounts payable balance was $19,472.

Calculating Average Payables Period For the past year, Coach, Inc., had a cost of goods sold of $87,386. At the end of the year, the accounts payable balance was $19,472. How long on average did it take the company to pay off its suppliers during the year? What might a large value for this ratio imply?Cost of Goods Sold$ 87,386.00Accounts Payable$ 19,472.00Average Payable Period03.27 Using the DuPont Identity Y3K, Inc., has sales of $10,570, total assets of $4,670, and a...

1. Giorgio had cost of goods sold of $9,529 million, ending inventory of $2,197 million, and...

1. Giorgio had cost of goods sold of $9,529 million, ending inventory of $2,197 million, and average inventory of $2,073 million. Its inventory turnover equals: 2. Bedrock Company reported a December 31 ending inventory balance of $416,000. The following additional information is also available: The ending inventory balance of $416,000 included $72,800 of consigned inventory for which Bedrock was the consignor. The ending inventory balance of $416,000 included $23,600 of office supplies that were stored in the warehouse and were...

Question