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Question

Interest Coverage Ratio tells us how many times the interest on loans can be covered using the .

A
taxes
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B
interests
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C
profits
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D
long-term debts
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Solution

The correct option is C profits
Interest Coverage Ratio tells us how many times the interest on loans can be covered using the profits. It express the relationship between net profit before interest and tax and interest payable on long-term debts.

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