Coverage Ratio: Trident Company Has Debt of $3

question 32

Multiple Choice

Coverage ratio: Trident Company has debt of $3.35 million with an interest rate of 6.875 percent. The company has an EBIT of $2,766,009. What is its times interest earned?

• A) 13 times
• B) 12 times
• C) 11 times
• D) None of the above

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Definitions:

Sampled Population

The subset of a larger population that is selected for the purpose of a scientific study or statistical analysis.

Degrees Of Freedom

A concept in statistics referring to the number of independent values or quantities which can vary in the computation of a statistic, often related to the number of observations in a sample minus the number of restrictions or parameters.

T-Distribution

A type of probability distribution that is symmetric and bell-shaped, used in statistics for small sample sizes when the population variance is unknown.

Confidence Interval

A scope of values, derived through sample statistical methods, seen as likely to include the value of an unascertained population parameter.