Pettijohn Inc. the Balance Sheet and Income Statement Shown Below Are for Are

question 60

Multiple Choice

Pettijohn Inc.
The balance sheet and income statement shown below are for Pettijohn Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.

-Refer to the data for Pettijohn Inc.What is the firm's EBITDA coverage?

• A) 3.29
• B) 3.46
• C) 3.64
• D) 3.82
• E) 4.01

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Definitions:

Balance Sheet

An accounting summary that captures a firm's financial status at a particular instant, outlining the company's resources, obligations, and equity held by shareholders.

Ledger

A book or collection of financial accounts where financial transactions are recorded.

Cash Payment

A transaction where a payment is made using physical currency or through electronic funds transfer, directly settling an obligation.

Cash Account

An account that records cash transactions, including cash received and disbursed, maintained by a company to keep track of its liquid assets.