Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. the morris corporation has $400,000 of debt outsta

The Morris Corporation has $400,000 of debt outstanding, and it pays an interest rate of...

70.2K

Verified Solution

Question

Accounting

The Morris Corporation has $400,000 of debt outstanding, and it pays an interest rate of 10% annually. Morris's annual sales are $2 million, its average tax rate is 40%, and its net profit margin on sales is 5%. If the company does not maintain a TIE ratio of at least 3 to 1, its bank will refuse to renew the loan and bankruptcy will result. What is Morris's TIE ratio? Round intermediate calculations to two decimal places. Round your answer to two decimal places.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

2 Find a polynomial function with zeros of 1 2i and 3 Multiplicity 2 Write...

Advance Math
1.2K views

Emerson Corporation just completed its first year of operations. Planned and actual production equaled 17,000 units,...

Chemistry
1.2K views

Given: 50 ml of 0.2 M weak acid is titrated with 0.2M NaOH. The pka of...

Medical Sciences
1.2K views

The Autonomic Nervous System can be challenging to understand because it is connected to virtually every...

Physics
1.2K views

21 A glass vessel contains air at 60 C To what temperature must it be...

Basic Math
1.2K views

In one particular suburb 50 of families own a pug If there are a total...

Calculus
1.2K views

Evaluate the integral of the function graphed using the formula for areas of triangles and...

Calculus
1.2K views

Calculate the derivative of the following function y sin cos 5x dy dx 11 6...

Accounting
1.2K views

Exercise 17-14 (Algo) Effect of pension expense components on balance sheet accounts (L017-7,...

Accounting
1.2K views

Problem was marked wrong, can someone help me find the correct answer ? ...

Accounting
1.2K views

When a taxpayer disagrees with CRA's interpretation of the Income Tax Act, what options does...

Finance
1.2K views

please answer all questions. Procedure is Experiment:...