Which of the following statements regarding the debt servicing capacity of a company is incorrect?
A) The debt to gross cash flow ratio is an indicator of debt servicing capacity.
B) The debt to gross cash flow ratio indicates years required for cash flows to repay total debt.
C) The interest cover ratio is an indicator of a company's capacity to service debt.
D) The lower the interest cover ratio, the greater the company's ability to cover interest commitments.
Correct Answer:
Verified
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