At the beginning of a year, Company X has opted to sell all of its $450,000 of receiva

bles to finance a reduction in its long-term debt. The receivables and the risk of default are transferred at 80% of their book value. The debt reduction will reduce interest expense from $50,000 to $25,000 per year. The effective tax rate is 30%. Assuming that the current year’s EBIT is $142,500, at the end of the year, the results of the receivables sale will be an interest coverage ratio closest to:

A. 1.1X.

B. 2.1X.

C. 3.1X.

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更多“At the beginning of a year, Co…”相关的问题

第1题

Selected information about a company is as follows:

The forecasted net income (in ‘000) for 2013 is closest to:

A.$169.

B.$202.

C.$244.

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第2题

The 2012 income statement for a subject company is as follows:

For 2013, net sales are projected to increase by 12%, gross profit margin is expected to increase by 2% while SG&A expenses as a percent of net sales is expected to remain constant, total debt is not expected to change, and the effective tax rate is expected to remain constant.

Based on the above information, the company’s 2013 projected net income (in millions) is closest to:

A. $33.

B. $44.

C. $55.

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第3题

An analyst uses a stock screener and selects the following metrics: a global equity index, P/E ratio lower than the median P/E ratio, and a price-book value ratio lower than the median price-book value ratio. The stocks so selected would be mostappropriate for portfolios of which type of investors?

A. Value investors.

B. Growth investors.

C. Market-oriented investors.

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第4题

When analyzing a company that prepares its financial statements according to U.S. GAAP, calculating the price/tangible book value ratio instead of the price/book value ratio is mostappropriate if it:

A. grows primarily through acquisitions.

B. develops its patents and processes internally.

C. invests a substantial amount in new capital assets.

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