Fixed Burden Coverage Ratio Measures

question 66

Multiple Choice

Fixed burden coverage ratio measures:

• A)the coverage of expenses associated with debt and operating income.
• B)the return on investment capital.
• C)the magnitude of historical capital expenditure over the years.
• D)none of the above.

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Definitions:

Bargained-For Exchange

In reference to agreements, when a promise is made in exchange for another promise, in exchange for an act, or in exchange for a forbearance to act.

Contracts For Necessaries

Legal agreements for the supply of essential goods or services, such as food, shelter, and clothing, especially pertinent to persons unable to enter into contracts, like minors.

Educational Loans

Financial aid provided to students to help cover the cost of education expenses, which must be repaid.

Voluntarily Sold

The act of willingly choosing to sell an asset or property without being forced by external circumstances.