Can you take on five any more debt in the acquisition, Financial Accounting

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Can you take on five any more debt in the acquisition

Problem

Your firm has tangible assets of $93 million. You are planning to acquire a ?rm that is one-third your firm's size. You 6 have bonds with a merger 8. Acquisition covenant that requires the combined ?rm to have a minimum ratio of net tangible assets to debt of 1.711. Your firm has a ratio of 2.131 and the target firm has a ratio of 14:1. Can you take on 5 any more debt in the acquisition and not violate your covenant?

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Financial Accounting: Can you take on five any more debt in the acquisition

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Financial Accounting: Can you take on five any more debt in the acquisition

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