Lever Age pays a 10% rate of interest on $9.90 million of outstanding debt with face value of $9.9 million. The firm's EBIT was $2.1 million. If depreciation is $190,000, what is its cash coverage ratio?

Lever Age pays a 10% rate of interest on $9.90 million of outstanding debt with face value of $9.9 million. The firm's EBIT was $2.1 million. If depreciation is $190,000, what is its cash coverage ratio?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter6: Accounting For Financial Management

Section: Chapter Questions

Problem 11P: The Berndt Corporation expects to have sales of 12 million. Costs other than depreciation are...

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Question

What is it's cash coverage ratio of this financial accounting question?

Lever Age pays a 10% rate of interest on $9.90 million of outstanding debt with face value
of $9.9 million. The firm's EBIT was $2.1 million. If depreciation is $190,000, what is its cash
coverage ratio?

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