As a result of issuing 20 -year bonds payable, Low-Cal Foods now has an interest coverage ratio

Question:

As a result of issuing 20 -year bonds payable, Low-Cal Foods now has an interest coverage ratio of .75 to 1 . Should this ratio be of greater concern to short-term creditors or to stockholders? Explain.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial & Managerial Accounting

ISBN: 9780073526997

15th Edition

Authors: Jan Williams, Sue Haka, Mark Bettner, Joseph Carcello

See More Books

Question Posted: May 19, 2024 04:02 AM

See More Questions

Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
In which control account would you expect to find a provision for doubtful debts?
Calculate the pH of water at 25C and 75C. The values for pKw at these temperatures are 13.99 and 12.70, respectively.
When a cyclist expends 1000 W of power to deliver mechanical energy to her bicycle at a rate of 100 W, show that the efficiency of her body is 10%.
Perfectly competitive firms are _________, who must accept the market price as determined by the forces of demand and supply.
Fesler Inc. acquired all of the outstanding common stock of Pickett Company on January 1, 2009. Annual amortization of $22,000 resulted from this transaction. On the date of the takeover, Fesler...
KL-JB Berhad wishes to accumulate funds to provide a retirement annuity for its Chief of Finance Officer (CFO) Mr. TJ Wong. Mr. Wong by contract will retire at the end of exactly 12 years. On...
Ortega Industries has a fully funded pension plan. Each year, pension expense runs in excess of $\$ 10$ million. At the present time, employees are entitled to receive pension benefits with a...
A $\$ 200$ million bond issue of NDP Corp. (a liquid company) recently matured. The entire maturity value was paid from a bond sinking fund. What effect did this transaction have on the company's...
In Problems 722, solve each inequality. x + 7x < -12
You are conducting an analysis of a technology company called PlioTech. You have reviewed the last 5 years of financial reports for PlioTech, and using the financial data you have calculated the...
S You are a relatively recent hire to Hartz & Company, a local manufacturer of plumbing supply products. You have been asked to prepare a condensed statement of cash flows for the months of November...
What are some mental blocks to departure that many potential entrepreneurs have that keep them from starting a business? Describe tactics used to cope with and get over the blocks to departure....
Bob sells farm equipment in Iowa and has for twenty years. The last two months he has seen the quantity demanded for high - end tractors decrease by 3 5 % compared to the same time last year. What is...
BANK OF CENTENNIAL Credit Card Statement of Account Credit Limit Account Number Interest Rates Annual Daily Limit: Available: $5,000.00 497 332 8751889 Purchases 17.999 0.04929 $3,344.69 Cash Advance...
Find the inverse Laplace transform of the following functions F(s) = e-s/ s + 1 F(s) = e-s/ s + 1 F(s) = 1- e 2s / s F(s) = 1- e 2s / s F(s) = 1- e s / s + 2
When is the indirect pattern appropriate, and what are the benefits of using it?
Using your answer to the pre-lab questions, use MS Excel (or any progam you choose) to plot your data in such a way that it is a straight line. Use the slope of your line to determine e/m. Compare to...
Suppose you short-sell a stock (which pays no dividends) for $53 and buy a $55-strike call option for $8.20. Assuming the effective annual interest rate is 4%, what is the profit on your position if...
Research question: On average, do STAT 200 students tend to score differently on their first and second attempts of the Lesson 9 Quiz? A random sample of 45 STAT 200 students who have taken the...

As a result of issuing 20 -year bonds payable, Low-Cal Foods now has an interest coverage ratio

Question:

Step by Step Answer:

Financial & Managerial Accounting

Students also viewed these Business questions