When assessing the fixed-payment coverage ratio,
A. the lower its value the more risky is the firm.
B. the lower its value, the lower is the firms financial leverage.
C. preferred stock dividend payments can be disregarded.
D. the higher its value, the higher is the firms liquidity.
Answer:A
When assessing the fixed-payment coverage ratio,
A. the lower its value the more risky is the firm. B. the lower its value, the lower is the firms financial leverage. C. preferred stock dividend payments can be disregarded. D. the higher its value, the higher is the firms liquidity.