Consider this simplified balance sheet for Geomorph Trading:

Current assets

$

170

Current liabilities

$

95

Long-term assets

570

Long-term debt

245

Other liabilities

140

Equity

260

$

740

$

740

a. What is the company’s debt-equity ratio? (Round your answer to 2 decimal places.)

b. What is the ratio of total long-term debt to total long-term capital? (Round your answer to 2 decimal places.)

c. What is its net working capital?

d. What is its current ratio? (Round your answer to 2 decimal places.)

6

Lever Age pays an 10% rate of interest on $10.50 million of outstanding debt with face value $10.5 million. The firm’s EBIT was $1.5 million.

a. What is its times interest earned? (Round your answer to 2 decimal places.)

b. If depreciation is $250,000, what is its cash coverage ratio? (Round your answer to 2 decimal places.)