ch6 The Financing Decision.pptVIP

FIGURE 6-1 Leverage Increases Risk and Expected Return TABLE 6-1 Selected Information about Harbridge Electronix’s Financing Options in 2000 ($ millions) TABLE 6-2 Harbridge Electronix Financial Obligations in 2000 ($ millions) Harbridge Electronix Analysis of Coverage TABLE 6-3 Debt Ratios, 1992 - 1997 (numbers in parentheses are the number of companies in the Industry sample) TABLE 6-3 (Concluded) Debt Ratios, 1992 - 1997 (numbers in parentheses are the number of companies in the industry sample) TABLE 6-4 Median Value of Key Ratios by Standard Poor’s Rating Category (industrial long-term debt, three-year figures, 1996 - 1998 TABLE 6-5 Harbridge Electronic Partial Pro Forma Income Statements in 2000 under Bust and Boom Conditions ($ millions except EPS) FIGURE 6-2 Range of Earnings Chart for Harbridge Electronix TABLE 6A-1 In the Absence of Taxes, Debt Financing Affects Neither Income nor Firm Value, in the Presence of Taxes, Prudent Debt Financing Increases Income and Firm Value TABLE 6A-1 (Concluded) In the Absence of Taxes, Debt Financing Affects Neither Income nor Firm Value, in the Presence of Taxes, Prudent Debt Financing Increases Income and Firm Value *Copyright ? 2001 by The McGraw-Hill Companies, Inc. All rights reserved. Irwin/McGraw-Hill* Chapter 6 The Financing Decision Continued See text for variable definitions Continued