Norway, Inc. has $16,000 in total assets, depreciation of $3,230, and interest of $2,200. The total asset turnover rate is 1.6. Earnings before interest and taxes are equal to 30 percent of sales. What is the cash coverage ratio? a. 6.11 b. 3.45 c. 5.54 d. 4.96

Norway, Inc. has $16,000 in total assets, depreciation of $3,230, and interest of $2,200. The total asset turnover rate is 1.6. Earnings before interest and taxes are equal to 30 percent of sales. What is the cash coverage ratio? a. 6.11 b. 3.45 c. 5.54 d. 4.96

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

Please provide answer the financial accounting question

Norway, Inc. has $16,000 in total assets,
depreciation of $3,230, and interest of $2,200.
The total asset turnover rate is 1.6. Earnings
before interest and taxes are equal to 30 percent
of sales.
What is the cash coverage ratio?
a. 6.11
b. 3.45
c. 5.54
d. 4.96

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