Leverage and coverage ratios the data for interest, Ask an Expert

Finance

Leverage and Coverage Ratios

(The data for interest coverage are in I-Metrix's liquidity ratios section. The others listed in this table are in the leverage ratios section.)

	Most Recent Fiscal Year	Fiscal Year (-1)	Fiscal Year (-2)	Fiscal Year (-3)
Debt/Equity	0.6223	0.6893	1.1880	0.1094
Debt/Assets	0.7906	0.7045	0.7070	0.4382
Interest Expense/Long term Debt	0.0501	0.0981	0.0324	0:no LTD
Times Interest Earned (TIE)	12.2922	9.1947	18.8934	34.7779
Interest Coverage	12.2922	9.1947	18.8934	34.7779

What trends, if any, are apparent in these ratios?
Are these favorable or unfavorable to the shareholders?
Are these favorable or unfavorable to the debt holders?
The debt/equity ratio from I-Metrix is based on book values. If you were to calculate the ratio on the basis of market values, would this ratio tend to be higher or lower than on the basis of book values? Why?

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9526578

Have any Question?Write your Review or question?

Related Questions in Basic Finance

How to find efffective annual rate of interest the terms of

How to find efffective annual rate of interest. The terms of sale are 4/10, net 49. How to find the required rate of return on equity. ABC Inc.'s stock is currently selling for $69.97 per share. The company just paid it ...

You decide to deposit 160521 dollars in an account that

You decide to deposit 1,605.21 dollars in an account that earns 10 percent annual interest (compounded annually). How much is in the account 10 years from now?

You invest 209100 at the beginning of every year and your

You invest $2,091.00 at the beginning of every year and your friend invests $2,091.00 at the end of every year. If you both earn an annual rate of return of 3.82% , how much more money will you have after 40 years? You c ...

What are some key factors needed for consideration in

What are some key factors needed for consideration in choosing a business location and why is location a key finance factor for most businesses?

Matt johnson delivers newspapers and is putting away 15 at

Matt Johnson delivers newspapers and is putting away ?$15 at the end of each month from his paper route collections. Matt is 10 years old and will use the money when he goes to college in 8 years. What will be the value ...

Question - find and read 2 articles about a recent merger

Question - Find and read 2 articles about a recent merger or acquisition. Write a paper of approximately 900 words for each article that answers the following questions: • What alternatives to the merger or acquisition m ...

Your firm spends 5200 every month on printing and mailing

Your firm spends $ 5,200 every month on printing and mailing? costs, sending statements to customers. If the interest rate is 0.52% per? month, what is the present value of eliminating this cost by sending the statements ...

Company m uses the percentage of sales method of estimating

Company M uses the percentage of sales method of estimating bad debts. At the beginning of the current fiscal year, Company M's allowance for doubtful accounts had a credit balance of $3,000. During the current year, Com ...

Fincorp will pay a year-end dividend of 280 per share which

Fincorp will pay a year-end dividend of $2.80 per share, which is expected to grow at a rate of 2% for the indefinite future. The discount rate is 10%. a. What is the stock selling for? (Do not round intermediate calcu ...

A commercial bank will loan you 58734 for 5 years to buy a

A commercial bank will loan you $58,734 for 5 years to buy a car. The loan must be repaid in equal monthly payments at the end of the month. The annual interest rate on the loan is 13.45 percent of the unpaid balance. Wh ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert