The Earnings to Fixed Charges Ratio

question 40

Multiple Choice

The earnings to fixed charges ratio:

• A)indicates how efficiently assets are used.
• B)typically includes depreciation in the denominator.
• C)typically excludes extraordinary gains and losses from the numerator.
• D)indicates the proportion of debt used to finance a company.

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Definitions:

Electricity Demand

The total amount of electrical power required by consumers and businesses at any given time.

Operating Costs

Expenses associated with the day-to-day functioning of a business, such as wages, rent, and utilities.

Alternative Sources

Different or non-traditional means or options available for achieving a specific goal, typically referring to energy, materials, or information.

Petroleum

A natural, flammable liquid found beneath the Earth's surface that is refined into fuel and various chemical products.