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The Docksider has net income for the most recent year of $24,650. The tax rate was...

The Docksider has net income for the most recent year of $24,650. The tax rate was 15 percent. The firm paid $1,800 in total interest expense and deducted $2,900 in depreciation expense. What was the cash coverage ratio for the year?
20.48 times
11.48 times
12.39 times
18.72 times
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Answer #1

Cash coverage ratio = (EBIT+Non Cash expense)/Interest expense

= (29000+1800+2900)/1800

Cash coverage ratio = 18.72

So answer is d) 18.72 Times

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