Question

MPI Incorporated has $3 billion in assets, and its tax rate is 35%. Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 5%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below.

TIE ratio
Total Assets	$3,000,000,000.00
Tax Rate	35.00%
Basic Earning Power (BEP) Ratio	10.00%
Return on Assets (ROA)	5.00%
			Formulas
EBIT			#N/A
Net Income			#N/A
Partial Income Statement:
EBIT	$0.00
Interest			#N/A
Earnings Before Taxes			#N/A
Taxes			#N/A
Net Income			#N/A
TIE Ratio			#N/A

What is MPI's times-interest-earned (TIE) ratio? Round your answer to two decimal places.

Answer 1

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