Fixed Financial Charges Include ________

question 208

Multiple Choice

Fixed financial charges include ________.

• A) common stock dividends and bond interest expense
• B) common stock dividends and preferred stock dividends
• C) bond interest expense and preferred stock dividends
• D) stock repurchase expense

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Definitions:

Operating Cash Flow

The cash generated by a company’s normal business operations, indicating whether the company can maintain and grow its operations.

Sales Revenues

Income received from selling goods or services over a period of time before any costs or expenses are deducted.

Capital Cost Allowance

A form of tax depreciation that allows businesses in Canada to deduct the cost of a depreciable property over several years.

Cash Operating Costs

Expenses associated with the day-to-day operations of a business that are paid out in cash.