Ellies Electronics Incorporated has total assets of $ 63 million and total debt of $ 42 million.
Question:
a. What is Ellie’s debt ratio?
b. What is Ellie’s times interest earned?
c. Based on the information above, would you recommend to Ellie’s management that the firm is in a strong enough position to assume more debt and increase interest expense to $ 9 million?
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a Debt ratio total debt total assets 42 million 63 million 06667 or 6667 b Times interest earn...View the full answer
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Related Book For 
Foundations of Finance The Logic and Practice of Financial Management
ISBN: 978-0132994873
8th edition
Authors: Arthur J. Keown, John D. Martin, J. William Petty
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