Here are some data for five companies in the same industry:

	Company Code
	A	B	C	D	E
EBIT	17.11	46.11	147.61	6.96	153.71
Interest expense	5.90	15.90	50.90	2.90	1.90

a. Calculate a measure of times-interest-earned for the industry.

b. Calculate a measure of times-interest-earned for each company.

c. Calculate the average of the times-interest-earned ratios for the individual companies.

d. Does changing the method of calculation make a significant difference to the end result?

Airlux Antarctica has current assets of $380 million, current liabilities of $280 million and a cash ratio of 0.13. How much cash and marketable securities does it hold? (Enter your answer in millions rounded to 1 decimal place.)

Sara Togas sells all its output to Federal Stores. The following table shows selected financial data, in millions, for the two firms:

	Sales	Interest Payment	Net Income	Assets at Start of Year
Federal Stores	$115	$19	$25	$65
Sara Togas	35	16	19	27.5

Assume tax rate is 35%.

a. Calculate the sales-to-assets ratio, the operating profit margin, and the return on assets for the two firms. (Do not round intermediate calculations. Round the sales-to-assets ratio answers to 2 decimal places. Enter the operating profit margin and return on assets answers as a percent rounded to 2 decimal places.)

b. Now assume that the two companies merge. If Federal continues to sell goods worth $115 million, how will the three ratios change? (Do not round intermediate calculations. Round the sales-to-assets ratio answer to 2 decimal places. Enter the operating profit margin and return on assets answers as a percent rounded to 2 decimal places.)