A company has a debt covenant in place that limits the amount it can borrow to 50% of its tangible assets.If the company's actual value for that ratio is approaching violation of this debt covenant,consistent with PAT,management would try to relax the constraint by:

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Revaluing assets upwards would increase the value of the company's tangible assets, which would in turn increase the amount the company can borrow without violating the debt covenant. This is consistent with the principle of PAT (Profit After Taxes), as it would increase the company's ability to generate profits by borrowing more funds to invest in growth opportunities. The other options do not directly affect the value of tangible assets and therefore would not relax the debt covenant constraint.

A Company Has a Debt Covenant in Place That Limits