Answered: Orion Systems pays a 7.5% interest rate…

Orion Systems pays a 7.5% interest rate on $15 million of outstanding debt. The firm's EBIT was $4.2 million, and depreciation was $500,000. What is Orion's 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

Chapter7: Analysis Of Financial Statements

Section: Chapter Questions

Problem 2P: Vigo Vacations has $200 million in total assets, $5 million in notes payable, and $25 million in...

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Question

What is the cash coverage ratio of this financial accounting question?

Orion Systems pays a 7.5% interest rate on $15 million
of outstanding debt. The firm's EBIT was $4.2 million,
and depreciation was $500,000. What is Orion's cash
coverage ratio?

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