Southeast Systems has the following balance sheet and the income statement. The company had 10...
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Finance
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Southeast Systems has the following balance sheet and the income statement. The company had 10 million shares of common stock outstanding and its market price of the common stock was $78 at the end of 2014. Make sure the unit is in million dollars.
(unit: $ in millions)
Southeast Systems
Balance Sheets
2014
2015
2014
2015
Cash
$50
$100
Accounts payable
$450
$500
Accounts receivable
600
700
Notes payable
300
400
Inventory
500
550
Long-term debt
650
650
Net fixed assets
1,000
1,000
Common equity
300
300
Retained earnings
450
500
Total Assets
$2,150
$2,350
Total Liabilities & Owners Equity
$2,150
$2,350
Income Statement
2015
Sales
$2,370
Cost of goods sold
2,070
Depreciation
200
EBIT
100
Interest expenses
20
Taxable income
80
Taxes
28
Net income
$52
Dividends
$2
What is the value of the interest coverage ratio for 2015?
2.6 times
4.0 times
5.0 times
10.0 times
118.5 times
Southeast Systems has the following balance sheet and the income statement. The company had 10 million shares of common stock outstanding and its market price of the common stock was $78 at the end of 2014. Make sure the unit is in million dollars.
(unit: $ in millions)
| Southeast Systems Balance Sheets | |||||
|
| 2014 | 2015 |
| 2014 | 2015 |
| Cash | $50 | $100 | Accounts payable | $450 | $500 |
| Accounts receivable | 600 | 700 | Notes payable | 300 | 400 |
| Inventory | 500 | 550 | Long-term debt | 650 | 650 |
| Net fixed assets | 1,000 | 1,000 | Common equity | 300 | 300 |
|
|
|
| Retained earnings | 450 | 500 |
| Total Assets | $2,150 | $2,350 | Total Liabilities & Owners Equity | $2,150 | $2,350 |
| Income Statement | |
|
| 2015 |
| Sales | $2,370 |
| Cost of goods sold | 2,070 |
| Depreciation | 200 |
| EBIT | 100 |
| Interest expenses | 20 |
| Taxable income | 80 |
| Taxes | 28 |
| Net income | $52 |
| Dividends | $2 |
What is the value of the interest coverage ratio for 2015?
| 2.6 times | ||
| 4.0 times | ||
| 5.0 times | ||
| 10.0 times | ||
| 118.5 times |
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