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Basic Question 7 of 8
Which of the following is not a measure of profitability?
B. Interest coverage ratio
C. Operating income
D. Operating expense ratio
E. Return on assets
A. Return on equity
B. Interest coverage ratio
C. Operating income
D. Operating expense ratio
E. Return on assets
User Contributed Comments 4
| User | Comment |
|---|---|
| Gina | Interest Coverage Ratio = EBIT/Interest Expense a financial risk ratio; earnings flow; how far can earnings decline before it becomes impossible to service debt with them. |
| mordja | Interest coverage ratio is a solvency ratio of the coverage ratio type. |
| bravoshieh | Really? Should not it be "Operating income ratio" rather? |
| ibrahim18 | @bravoshieeh. I thought so too |
I used your notes and passed ... highly recommended!
Lauren
Learning Outcome Statements
calculate and interpret activity, liquidity, solvency, and profitability ratios
describe relationships among ratios and evaluate a company using ratio analysis
CFA® 2025 Level I Curriculum, Volume 3, Module 11.