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Author Question: A new firm is developing its business plan. It will require $680,000 of assets, and it projects ... (Read 66 times)

Labomba

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on: Aug 7, 2023
A new firm is developing its business plan. It will require $680,000 of assets, and it projects $551,300 of sales and $402,100 of operating costs for the first year. Management is quite sure of these numbers because of contracts with its customers and suppliers. It can borrow at a rate of 8.1%, but the bank requires it to have a TIE ratio of at least 4.6, and if the TIE ratio falls below this level the bank will call in the loan and the firm will go bankrupt. What is the maximum debt ratio the firm can use? (Hint: Find the maximum dollars of interest, then the debt that produces that interest, and then the related debt ratio.)

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56.31%


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57.60%


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58.89%


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59.02%

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by Labomba on Aug 7, 2023

ludadtpb

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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Labomba

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Reply 2 on: Aug 7, 2023
YES! Correct, THANKS for helping me on my review

sultansheikh

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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