Interest coverage ratio = 6, indicates :

CS Executive · Corporate and Management Accounting · PYQS · June 2021
Interest coverage ratio = 6, indicates :
(A) Sales are 6 times of interest
(B) Profit after tax is 6 times of interest
(C) EBIT is 6 times of interest
(D) Interest is 6 times after tax

Answer & Explanation:

Correct Answer: Option (C)

Official answer key: (C).

Topics: Management Accounting

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