From a Cash Flow Position,which One of the Following Ratios

question 51

Multiple Choice

From a cash flow position,which one of the following ratios best measures a firm's ability to pay the interest on its debts?

• A)Times interest earned ratio
• B)Cash coverage ratio
• C)Cash ratio
• D)Quick ratio
• E)Debt-equity ratio

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Definitions:

Net Income

The earnings of a company after taking into account all expenses, including operational costs, interest, and taxes, subtracted from its total revenue.

Additional Advertising

Additional Advertising denotes the increased efforts or expenditures in promotional activities aimed at boosting sales or awareness beyond the initial or planned scope.

Scatter Diagram

A graphical representation that displays the relationship between two variables, typically to identify correlation patterns.

Cost Behavior

The way different types of production costs change when there is a change in level of production activity.