📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

      An analyst who is interested in a company’s

    long-term solvency would most likely examine the:
    A Return on total capital Correct Answer Incorrect Answer
    B Interest coverage ratio Correct Answer Incorrect Answer
    C Current ratio Correct Answer Incorrect Answer
    D Inventory turnover ratio Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Fixed charge/Interest coverage is a solvency ratio. Return on total capital is a measure of profitability. The rest of the ratios are liquidity and turnover ratios.

    Practice Next
    More Alternate Sources of Finance Questions

    Relevant for Exams:

    ask-question