-The Above Information Is Available for the Firm ILA Ltd,which

question 38

Multiple Choice

$\begin{array}{|l|l|}\hline \text { Item } & \text { Value as at 2010, in millions } \\\hline \text { Sales revenue } & 8.902 \\\hline \text { Operating revenue } & 9.360 \\\hline \text { Trading profit before interest and tax } & 5.360 \\\hline \text { Operating profit before interest and taxes } & 3.118 \\\hline \text { Interest expense } & 1.361 \\\hline \text { Operating profit after tax } & 0.360 \\\hline\end{array}$
-The above information is available for the firm ILA Ltd,which is listed on the Australian Stock Exchange.As a prospective investor in ILA,you are concerned about the level of debt the company has on issue.How far can the earnings of ILA fall before it will be unable to meets its debt obligations?

• A) \( 0.436 \)
• B) \( 0.480 \)
• C) \( 0.564 \)
• D) \( 0.602 \)

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Definitions:

Circular Letter

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The first legislative assembly of elected representatives in North America, established by the Virginia Company in 1619, playing a significant role in American colonial government.

Stamp Act Resolves

A series of resolutions passed in 1765 by the American colonies protesting the British Stamp Act, which imposed direct taxation without representation.

Independence

The condition of a nation, country, or state which exercises self-government, and usually sovereignty, over the territory.