In 2020, Natural Selection, a nationwide computer dating service, had $514 million of assets and $207 million of Babes Earnings before interest and taxes were $127 million, interest expense was $28.5 million, the tax rate was 40 percent, principal repayment requirements were $24.7 million, and annual dividends were 25 cents per share on 20 million shares outstanding a. Calculate the following for Natural Selection: Note: Round your answers to 2 decimal places. Liabilities-to-equity ratio Times-interest-earned ratio Times burden covered b. What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover Note: Round your answers to 1 decimal place. Interest payment requirements? Principal and interest requirements? Principal, interest, and common dividend payments? % %

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
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d
In 2020, Natural Selection, a nationwide computer dating service, had $514 million of assets and $207 million of Babies. Earnings
before Interest and taxes were $127 million, interest expense was $28.5 million, the tax rate was 40 percent, principal repayment
requirements were $24.7 million, and annual dividends were 25 cents per share on 20 million shares outstanding
a. Calculate the following for Natural Selection:
Note: Round your answers to 2 decimal places.
Liabilities-to-equity ratio
Times-interest-earned ratio
Times burden covered
b. What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover
Note: Round your answers to 1 decimal place.
Interest payment requirements?
Principal and interest requirements?
Principal, interest, and common dividend payments?
%
%
%
Transcribed Image Text:d In 2020, Natural Selection, a nationwide computer dating service, had $514 million of assets and $207 million of Babies. Earnings before Interest and taxes were $127 million, interest expense was $28.5 million, the tax rate was 40 percent, principal repayment requirements were $24.7 million, and annual dividends were 25 cents per share on 20 million shares outstanding a. Calculate the following for Natural Selection: Note: Round your answers to 2 decimal places. Liabilities-to-equity ratio Times-interest-earned ratio Times burden covered b. What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover Note: Round your answers to 1 decimal place. Interest payment requirements? Principal and interest requirements? Principal, interest, and common dividend payments? % % %
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