Question: Credit Analysis: Compute the Debt / EBITDA ratio for the 5% Subordinated Bonds in the following capital structure. Cheeter Inc. $100 million Equity Market Value

Credit Analysis:

Compute the Debt / EBITDA ratio for the 5% Subordinated Bonds in the following capital structure.

Cheeter Inc.

  • $100 million Equity Market Value
  • $80 million 5% Subordinated Bonds
  • $200 million 3% Senior Bonds
  • EBITDA is $70 million

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