The Interest Coverage Ratio Gives an Indication of a Company's

question 147

True/False

The interest coverage ratio gives an indication of a company's ability to make its interest payments as they come due.

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Definitions:

Probable Likelihood

A high chance or probability that an event will occur.

Accrual

A method of accounting that records income and expenses when they are earned or incurred, regardless of when the cash transactions occur.

Disclosure

The act of providing essential information or facts, especially those that may influence the decision-making of investors or stakeholders.

Interest Calculations

The process of determining the amount of interest due on a loan or investment based on the principal, rate, and time.