Question

Bad debts recovered of 12,000 will not affect which of the following ratio?
a. Gross Profit Ratio
b. Operating Ratio
c. Operating Profit Ratio
d. Interest Coverage Ratio​

Answer 1

Answer:

d

Explanation:

interest coverage ratio

Answer 2

Answer:

Bad debts recovered of 12,000 will not affect which of the following ratio?

answer- d. Interest Coverage Ratio​

Explanation:

• Gross Profit Ratio- gross margin is the difference between revenue and cost of goods sold, divided by revenue. Gross margin is expressed as a percentage. Generally, it is calculated as the selling price of an item, less the cost of goods sold, then divided by the same selling price.
• Operating Ratio- the operating ratio is a company's operating expenses as a percentage of revenue. This financial ratio is most commonly used for industries which require a large percentage of revenues to maintain operations, such as railroads. In railroading, an operating ratio of 80 or lower is considered desirable.
• Operating Profit Ratio- an operating profit ratio is calculated by dividing operating profit by total revenue.
• Interest Coverage Ratio- times interest earned or interest coverage ratio is a measure of a company's ability to honor its debt payments.

Hence, correct option is d. interest coverage ratio.