AEI Incorporated has $5 billion in assets, and its tax rate is 40%. Its basic earning power
Question:
AEI Incorporated has $5 billion in assets, and its tax rate is 40%. Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 5%. What is AEI’s times-interest-earned (TIE) ratio?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 69% (13 reviews)
TA 5000000000 T 40 EBITTA 10 ROA 5 T...View the full answer
Answered By
Vineet Kumar Yadav
I am a biotech engineer and cleared jee exam 2 times and also i am a math tutor. topper comunity , chegg India, vedantu doubt expert( solving doubt for iit jee student on the online doubt solving app in live chat with student)
5.00+
2+ Reviews
10+ Question Solved
Related Book For
Fundamentals of Financial Management
ISBN: 978-0324664553
Concise 6th Edition
Authors: Eugene F. Brigham, Joel F. Houston
Question Posted:
Students also viewed these Finance questions
-
AEI Incorporated has $8 billion in assets, and its tax rate is 35%. Its basic earning power (BEP) ratio is 12%, and its return on assets (ROA) is 6%. What is AEI's times-interest-earned (TIE) ratio?
-
Counts Accounting's beta is 1.15 and its tax rate is 40%. If it is financed with 20% debt, what is its unlevered beta?
-
Counts Accounting's beta is 1.15 and its tax rate is 40%. If it is financed with 20% debt, what is its unlevered beta? Discuss.
-
Use the DerivaGem software to value a five-year collar that guarantees that the maximum and minimum interest rates on a LIBOR-based loan (with quarterly resets) are 7% and 5% respectively. The LIBOR...
-
Define what a final system requirement document? What sections does your final system requirement document include? What do you believe are the most important sections, and why? Who is the audience...
-
Identify the members of the Southern Common Market (MERCOSUR). How has it performed?
-
On 31 March 2004, D Biggs, who prepares his financial statements to 31 March, bought a lorry on hire purchase from Truck Fleet Ltd. The cash price of the lorry was 61,620. Under the terms of the hire...
-
Assume that the nation of Spain is small and unable to influence the Brazilian (world) price of steel. Spains supply and demand schedules are illustrated in Table. Assume that Brazils price is $400...
-
What is the accumulated value of deposits of $1120.00 made at the end of every six months for three years if interest is 8.48% compounded quarterly? Question2. What is the accumulated value after...
-
The common shares of Twitter, Inc. (TWTR) recently traded on the NYSE for $18.50 per share. You have employee stock options to purchase 1,000 TWTR shares for $16 per share. The options expire in...
-
Which of the following statements is most correct? a. If a firms expected basic earning power (BEP) is constant for all of its assets and exceeds the interest rate on its debt, adding assets and...
-
The Petry Company has $1,312,500 in current assets and $525,000 in current liabilities. Its initial inventory level is $375,000, and it will raise funds as additional notes payable and use them to...
-
Assume that the information desk employee in Problem 1 earns $10 per hour. The cost of waiting time, in terms of customer unhappiness with the mall, is $12 per hour of time spent waiting in line....
-
An enterprise produces and sells Item A. The selling price of this item, regardless of the size of the sales, is 20.00 per unit. Normal production and sales are 10,000 units per year. For 2012,...
-
1. Choose a crime involving a victim(s), a defendant and a court case. 2. Identify the Criminal Justice team i.e. law enforcement, prosecutor, victim advocate etc. 3. Research each person and write a...
-
A company's 2005 sales were $10 million. If sales grow at 8% per year, how large will they be in 8 years? 2. Suppose a government bond will pay $1,000 three years from now. If the going interest rate...
-
Match the DHCP options with their descriptions. Question 3 options: Provides a means of increasing the IP addresses available in DHCP by adding a scope from another subnet. Allows two separate DHCP...
-
Taxpayer buys a used car from a dealership, in exchange for $6,000 in cash plus $24,000 in seller financing. The debt is subsequently reduced to $15,000. a) Suppose that the debt reduction occurred...
-
The rigid bar is supported by the pin-connected rod CB that has a cross-sectional area of 500 mm2 and is made of A-36 steel. Determine the vertical displacement of the bar at B when the load is...
-
The process of collaborative goal setting by a manager and subordinate, the extent to which goals are accomplished is a major factor in evaluating and rewarding the subordinate's performance. It is...
-
If f (x) = x 2 +2 and g(x) = x 3 2x 2 3, derive expressions for the functions formed by a. f(x) + g(x) b. 2f (x) + 4g(x)
-
Suppose you held a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolios beta is 1.12. Now suppose you decided to sell one of the stocks in...
-
Industries (HRI) has a beta of 1.8, while LR Industries (LRI) beta is 0.6. The risk-free rate is 6%, and the required rate of return on an average stock is 13%. The expected rate of inflation built...
-
You have been managing a $5 million portfolio that has a beta of 1.25 and a required rate of return of 12%. The current risk-free rate is 5.25%. Assume that you receive another $500,000. If you...
-
Below are three Independent and unrelated errors. 1. On December 31, 2023, Wolfe-Bache Corporation failed to accrue salaries expense of $2,100. In January 2024, when it paid employees for the...
-
When originally purchased, a vehicle costing $23,400 had an estimated useful life of 8 years and an estimated salvage value of $1,800. After 4 years of straight-line depreciation, the asset's total...
-
. Case: OPTIMA. Optima is a high technology organization that produces a mass storage system. The design of Optima's system is unique and represents a breakthrough in the industry. The units Opti...
Study smarter with the SolutionInn App