Use the following information for Cronos Group, Inc. (CRON): EBIT / Revenue 25.50% Government Tax Rate 42.50% Revenue / Assets 1.95 times Current Ratio 3.15 times EBT / EBIT 0.80 times Assets / Equity 2.00 times Its interest coverage ratio is closest to: A. 2.50. B. 5.00. C. 7.15. D. 9.25.
Use the following information for Cronos Group, Inc. (CRON): EBIT / Revenue 25.50% Government Tax Rate 42.50% Revenue / Assets 1.95 times Current Ratio 3.15 times EBT / EBIT 0.80 times Assets / Equity 2.00 times Its interest coverage ratio is closest to: A. 2.50. B. 5.00. C. 7.15. D. 9.25.
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
Related questions
Question
Use the following information for Cronos Group, Inc. (CRON):
| EBIT / Revenue | 25.50% |
| Government Tax Rate | 42.50% |
| Revenue / Assets | 1.95 times |
| Current Ratio | 3.15 times |
| EBT / EBIT | 0.80 times |
| Assets / Equity | 2.00 times |
Its interest coverage ratio is closest to:
A.
2.50.
B.
5.00.
C.
7.15.
D.
9.25.
Expert Solution
Step 1: Introduction:
An organization's ability to pay the interest on its outstanding loans is assessed using the Interest Coverage Ratio (ICR), a financial ratio. Lenders, creditors, and investors frequently utilize the Interest Coverage Ratio (ICR) to assess the risk of providing a company with a capital loan. The ratio is known as the "times interest earned" which is another name for the interest coverage ratio.
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