Question
Merrimac Brewing company's total assets equal $18 million. The book value of Merrimac's equity is $6...
Merrimac Brewing company's total assets equal $18 million. The book value of Merrimac's equity is $6 million. Excess cash is $200,000. The market value of Merrimac's equity is $10 million. Its Debt to Enterprise Value ratio is .5. What is the book value of Merrimac's interest- bearing debt?
A) $5.25 million
B) $10.2 million
C) $15 million
D) $20.4 million
Debt to Enterprise Value ratio = ???? ????? ?? ???????? ??????? ???? − ?????? ???ℎ ???? ????? ?? ??????????????? ???? − ?????? ???ℎ + ?? ?? ??????
= x−0.2mil x−0.2mil+10mil = 0.5
0.5X=0.6 mil
X=10.2
I'm lost Idk how my teacher got 0.5 I'm doing it on my calculator and I can't get "0.5" along with 10.2
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