Which of the Following Describes the Interest Coverage Ratio

question 56

Multiple Choice

Which of the following describes the interest coverage ratio?

• A)Income before income taxes plus interest expense divided by interest expense
• B)Income after income taxes plus interest expense divided by interest expense
• C)Income after income taxes divided by interest expense
• D)Income before income taxes minus interest expense divided by interest expense

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Definitions:

FOB Destination

A shipping term indicating that the seller bears freight charges and remains responsible for the goods until they are delivered to the buyer's location.

Freight Costs

Expenses incurred by a company to transport goods from one place to another, such as shipping charges for receiving or sending out inventory.

Trade Discount

A reduction in the list price granted by a supplier to a buyer, often based on the volume of goods purchased or to maintain a competitive advantage.

Free On Board

A shipping term indicating whether the seller or the buyer is responsible for goods that are damaged or destroyed during shipping.