Santa Corporation NOTE: These Multiple Choice Questions Require Present Value

question 3

Multiple Choice

Santa Corporation NOTE: These multiple choice questions require present value information.
Santa Corporation manufactures Christmas decorations and supplies throughout the world.The company owns property,plant,and equipment and also enters into operating leases for certain facilities.Assume that Santa's incremental borrowing rate is 8%.The company's tax rate is 40%.Listed below is selected financial data for Santa and a portion of the company's operating lease footnote.
Using the information provided by Santa Corporation calculate the company's 2012 fixed asset ratio.

• A) 3.0
• B) 3.65
• C) 3.23
• D) 5.21

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