Interest Coverage Ratio and proprietary ratio comes under: • Solvency
Right Answer is: A
• Solvency ratios- These ration shows extent to which assets cover commitments for future payment obligations. Interest Coverage Ratio, Proprietary ratio & Total Debt to Total Assets ratio are solvency ratios.
• Activity ratios- these ratios are calculated for measuring the efficiency of Operation of business based on effective utilisation of resources
• Profitability ratios-These ration measures profitability of a firm.
• Liquidity ratios-These ration shows whether company’s Current Assets are sufficient to meet company’s short term obligations.