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AIWMI CCRA-L2 Exam - Topic 9 Question 103 Discussion

Actual exam question for AIWMI's CCRA-L2 exam
Question #: 103
Topic #: 9
[All CCRA-L2 Questions]

Scott is a credit analyst with one of the credit rating agencies in Indi

a. He was looking in Oil and Gas Industry companies and has presented brief financials for following 4 entities:

Which of the four entities has best interest coverage ratios?

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Suggested Answer: C

by Corinne at Nov 17, 2024, 04:39 AM

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Lillian
5 months ago
B Ltd has been improving, but still not the best.
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Marshall
5 months ago
Wait, are we sure about those numbers?
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Josefa
6 months ago
I think D Ltd might surprise us, though.
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Dorthy
6 months ago
Totally agree, A Ltd is looking strong!
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Kara
6 months ago
A Ltd has the highest interest coverage ratio.
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Myong
6 months ago
I need to double-check the financials; I’m uncertain if it’s A Ltd or D Ltd that has the best ratio based on what we studied.
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Naomi
6 months ago
I feel like C Ltd might have a better interest coverage ratio, but I could be mixing it up with another company.
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Dong
7 months ago
I think we had a similar question in our last mock exam, and I believe it was about comparing financial ratios.
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Alaine
7 months ago
I remember we practiced calculating interest coverage ratios, but I’m not sure which entity has the highest one here.
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Vonda
7 months ago
This is a good opportunity to demonstrate my analytical skills. I'll methodically work through the data, calculate each ratio, and identify the entity with the strongest interest coverage.
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Loreen
7 months ago
I'm feeling a little lost here. Calculating and comparing those ratios seems tricky. I better make sure I have a solid grasp of the concept before trying to solve this.
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Queen
7 months ago
Okay, I got this. I just need to find the EBIT and interest expense for each company, then divide EBIT by interest expense to get the coverage ratio. The one with the highest ratio is the answer.
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Tammara
7 months ago
Hmm, I'm a bit unsure about how to approach this. I'll need to make sure I understand how to properly calculate the interest coverage ratio for each company. Maybe I should review my notes on that formula first.
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Dexter
7 months ago
This looks like a straightforward question on calculating and comparing interest coverage ratios. I'll need to carefully review the financial data for each entity and determine which one has the highest ratio.
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Alyce
1 year ago
C Ltd for the win! Their interest coverage is off the charts compared to the others. Though I have to say, the negative ratio for B Ltd is truly impressive - they've managed to defy the laws of finance!
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Delpha
11 months ago
C Ltd seems like a solid choice based on their financial performance.
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Mignon
12 months ago
It's surprising to see B Ltd with a negative ratio, they must be really struggling financially.
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Samira
12 months ago
I agree, C Ltd definitely has the best interest coverage ratios among the four entities.
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Melvin
1 year ago
Hmm, D Ltd has a pretty decent 5.4 coverage ratio, but C Ltd's 8.0 is just too good to ignore. I guess D Ltd is the silver medalist in this competition.
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Annita
11 months ago
Definitely, C Ltd seems to be the winner in this scenario.
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Josefa
11 months ago
I think A Ltd and B Ltd are not even in the running with their lower ratios.
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Merilyn
11 months ago
Yes, D Ltd's 5.4 is good, but C Ltd definitely takes the lead.
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Izetta
12 months ago
I agree, C Ltd's interest coverage ratio of 8.0 is impressive.
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Aron
1 year ago
I think A Ltd has the best interest coverage ratios because their financials look more stable.
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Floyd
1 year ago
The interest coverage ratio for C Ltd is clearly the highest, so it's the obvious answer. Though I do have to wonder, what kind of crazy business is B Ltd running to have a negative coverage ratio?
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Vicente
12 months ago
I know, it's surprising that B Ltd has a negative coverage ratio. They must be in trouble.
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Adolph
12 months ago
C Ltd has the best interest coverage ratio.
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Domingo
1 year ago
I disagree, I believe C Ltd has the best interest coverage ratios.
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Inocencia
1 year ago
Based on the interest coverage ratios shown, C Ltd has the highest ratio at 8.0, which indicates it has the best ability to cover its interest payments. This makes C Ltd the best choice.
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Shaunna
11 months ago
Definitely, C Ltd seems to be the most financially stable choice.
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Dana
11 months ago
So, we should consider C Ltd as the best option based on the interest coverage ratios.
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Cory
12 months ago
I agree, C Ltd's ratio is the highest among the four entities.
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Geoffrey
1 year ago
I think C Ltd has the best interest coverage ratio.
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Marica
1 year ago
I think D Ltd has the best interest coverage ratios.
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