Which Ratio Measures the Number of Dollars of Operating Earnings

question 15

Multiple Choice

Which ratio measures the number of dollars of operating earnings available to meet each dollar of interest obligations on the firm's debt?

• A) fixed-charge coverage ratio
• B) times interest earned
• C) cash coverage ratio
• D) ROA

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Definitions:

Task Interdependence

The degree to which tasks and roles within a team or organization are interconnected and reliant upon each other for successful completion.

Third-party Conflict

Involves the intervention of an external agent to help resolve a disagreement or dispute between two other parties.

Process Control

The practice of monitoring and adjusting processes to ensure they meet desired outcomes, often used in manufacturing and production.

Outcome Control

The regulation and monitoring of results or outputs, often in a business or organizational context.