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What is Morris TIE ratio

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Question - The Morris Corporation has $650,000 of debt outstanding, and it pays an interest rate of 8% annually. Morris' annual sales are $3.25 million, its average tax rate is 35%, and its net profit margin on sales is 5%. If the company does not maintain a TIE ratio of at least 4 to 1, its bank will refuse to renew the loan and bankruptcy will result. What is Morris' TIE ratio?

Reference no: EM132207331

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