29．On 1 January 2003, a company entered into a 10-year capital lease agreement that required an annual payment of $150,000 at the end of each year. For the year ended 31 December 2004, the company reported earnings before interest and taxes of $370,000. During 2004, the company had no interest-bearing debt outstanding. If the appropriate lease-related interest rate is 8 percent, the company抯 interest coverage ratio for 2004 was closest to:
Select exactly 1 answers from the following:
A. 3.1. B. 3.4. C. 4.6. D. 4.9.
答案和详解如下！
Feedback: Correct answer: D
揂nalysis of Financial Statements,?Ch. 10, pp. 319?58 and Exhibits 10.1, 10.2, and 10.3, Investment Analysis and Portfolio Management, 7th edition, Frank K. Reilly and Keith C. Brown (Dryden, 2003), pp. 343?44 The Analysis and Use of Financial Statements, 3rd edition, Gerald I. White, Ashwinpaul C. Sondhi, and Dov Fried (Wiley, 2003), pp. 367?71 2006 Modular Level I, Vol. II, pp. 669-670, 946-952 Study Sessions 8-35-b; 10-44-b calculate, interpret, and discuss the uses of measures of a company抯 internal liquidity, operating performance (i.e., operating efficiency (activity) and operating profitability), risk profile, and growth potential; calculate the effects of capital and operating leases on the financial statements and ratios of the lessees
Present value of lease payments on 1 January 2003: $1,006,512. Balance remaining on 1 January 2004: $937,033. 2004 interest: $74,963. Interest coverage ratio for 2004: $370,000 / $74,963 = 4.94.
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发表于 2006-11-22 11:00
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