Interest Coverage Ratio Is a Measure of

question 169

Multiple Choice

Interest coverage ratio is a measure of

• A)financial leverage.
• B)income after taxes and interest divided by interest expense.
• C)stockholders' control.
• D)protection from default on interest.

---

Definitions:

Payable

The status of an obligation that is due to be paid.

Instrument

A written legal document that formalizes an agreement or an obligation.

Drawer

In banking and finance, the person who writes or draws a check, draft, or bill of exchange.

Drawee

The party in a transaction upon whom a check, draft, or bill of exchange is drawn and who is directed to pay.