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Damm [24]
4 years ago
8

A firm has sales of $68,400, costs of $42,900, interest paid of $2,100, and depreciation of $6,500. The tax rate is 34 percent.

What is the value of the times interest earned (TIE) ratio?
a. 9.04
b. 15.24
c. 17.27
d. 12.14
e. 24.56
Business
1 answer:
tankabanditka [31]4 years ago
7 0

Answer:

9.04

Explanation:

TIE ratio = profit excluding interest/interest

expense

Putting value in above equation;

TIE ratio = 68400-42900-6500/2100

TIE ratio = 9.04

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1. The statement of cash flows of Stuart Company for the year ended December 31, 2021, is as follows:

Stuart Company

<h3>Statement of Cash Flows</h3>

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Net Cash Flow from Operating Activities $8,000

2. The Net Cash Flow from Operating Activities for Stuart Company for 2021 is <u>$8 million</u>.

<h3>What are operating activities' cash flows?</h3>

The cash flows from the operating activities section affect revenues and expenses.

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2 years ago
A company is considering the purchase of new equipment for $57,000. The projected annual net cash flows are $23,400. The machine
lina2011 [118]

Answer:

Net Present Value = $3,304.069

Explanation:

<em>To determine whether or not the investment was right, we will need to determine the net present value of the investment (NPV). </em>

<em>The NPV is the difference between the present value PV of cash inflows and the PV of cash outflows. A positive NPV implies a good investment decision and a negative figure implies the opposite. </em>

NPV of an investment(NPV)

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Net Present Value = 60,304.06 - 57,000 = 3,304.069

Net Present Value = $3,304.069

<em>Kindly note that a discount rate of 8% was used as it is the opportunity cost of capital for the investment.</em>

     

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