The Cash Coverage Ratio Directly Measures the Ability of a Company

question 97

Multiple Choice

The cash coverage ratio directly measures the ability of a company to meet its obligation to pay:

• A) an invoice to a supplier.
• B) wages to an employee.
• C) interest to a lender.
• D) principal to a lender.
• E) a dividend to a shareholder.

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Definitions:

Corporate Social Responsibility

A business model that integrates self-regulation into its business model to ensure its operations adhere to laws, ethical standards, and international norms, often going beyond profit to include environmental and social welfare.

Legal Requirements

Obligations imposed by law that individuals and organizations are bound to comply with.

Legal Responsibility

The obligation to act according to law, including adhering to statutes, regulations, and being accountable for actions or decisions.

External Regulations

Rules, standards, and laws that an organization must follow, which are imposed by external bodies such as governments or industry associations.