$$\begin{array}{l}
\begin{array} {lll }
&£000\
\text {Sales}&15,000\
\text {Grass Prafit}&5,000\
\text {Operating Prafit}&3,000\
\text {Finance Expense}&500\
\text {Profit Elofore Taxation}&2,500\
\end{array}
\end{array}$$ Based on the above figures, what is the interest cover ratio?

Question

$$\begin{array}{l}
\begin{array} {lll } 
&£000\
\text {Sales}&15,000\
\text {Grass Prafit}&5,000\
\text {Operating Prafit}&3,000\
\text {Finance Expense}&500\
\text {Profit Elofore Taxation}&2,500\
\end{array}
\end{array}$$ Based on the above figures, what is the interest cover ratio?

Quizplus · Accepted Answer

The interest cover ratio is calculated as Operating Profit divided by Finance Expense. Here, Operating Profit is £3,000 and Finance Expense is £500. Therefore, the interest cover ratio is £3,000 / £500 = 6 times.

Based on the Above Figures, What Is the Interest Cover