B/S Leverage: LEVERAGE 2020 2019 2017 Debt/Total Capital 150.2% 2018 Debt/EBITDA 2.02x 6.3x 2.9x 89.0% 1.82x 8.4x 3.1x 41.9% 0.76x 44.7x 3.8x Times Interest Earned Fixed Charge Coverage 251.4% 3.75x 3x 1.9x a. Based on the leverage ratios above, describe what is happening to leverage at Gracenat Company AND provide two different and separate reasons why this might have happened. b. Based on these leverage ratios, what do you believe the outlook is for this company in two years (2022)? Please answer both the questions
B/S Leverage: LEVERAGE 2020 2019 2017 Debt/Total Capital 150.2% 2018 Debt/EBITDA 2.02x 6.3x 2.9x 89.0% 1.82x 8.4x 3.1x 41.9% 0.76x 44.7x 3.8x Times Interest Earned Fixed Charge Coverage 251.4% 3.75x 3x 1.9x a. Based on the leverage ratios above, describe what is happening to leverage at Gracenat Company AND provide two different and separate reasons why this might have happened. b. Based on these leverage ratios, what do you believe the outlook is for this company in two years (2022)? Please answer both the questions
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
100%
B/S Leverage:
LEVERAGE
2020
2019
2017
Debt/Total Capital
150.2%
2018
Debt/EBITDA
2.02x
6.3x
2.9x
89.0%
1.82x
8.4x
3.1x
41.9%
0.76x
44.7x
3.8x
Times Interest Earned
Fixed Charge Coverage
251.4%
3.75x
3x
1.9x
a. Based on the leverage ratios above, describe what is happening to leverage at Gracenat Company AND provide two different and separate reasons why this might have happened.
b. Based on these leverage ratios, what do you believe the outlook is for this company in two years (2022)?
Please answer both the questions
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