Question: How does the Cash Coverage ratio differ from the Fimes interest Earned ratio? The Cash Coverage ratio is always lower than the TIE ratio. The
How does the Cash Coverage ratio differ from the Fimes interest
Earned ratio?
The Cash Coverage ratio is always lower than the TIE ratio.
The Cash Cowerape ratio only considers longterm debt, while the TIE
ratio includes ail interest expenses.
The Gash Coverage rano is used for short term analysis, while the TiE
ratio is used for longterminalysis:
The Cash Coverage ratio includes depreciation in its calculation, providings
a more cashfloworiented measure.
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