PT’s IAS Academy UPSC Prelims 2020 Paper I Analysis

Under the ryotwari settlement system, the government recognized mirasidars as the sole proprietors of land,dismissing tenants’ rights completely. Only in villages where no mirasidar system existed were those villagers holding permanent occupancy rights recognized as landholders responsible for the payment of land revenue. The Preamble to the Constitution declares India to be a Sovereign, Socialist, Secular and Democratic Republic. The term ’democratic’ denotes that the Government gets its authority from the will of the people. It gives a feeling that they all are equal “irrespective of the race, religion, language, sex and culture.” So, 1 is correct.

  1. For one, it is important to note that interest coverage is highly variable when measuring companies in different industries and even when measuring companies within the same industry.
  2. As noted above, having a higher interest coverage ratio is usually considered desirable because it means that a company can better fulfill its financial obligations.
  3. Third-party coverage applies when persons sue or make claims against the insured business, or governments or regulators demand information from the insured business.
  4. Rest of the statement is irrelevant for our discussion.

While an interest coverage ratio of 1.5 may be the minimum acceptable level, two or better is preferred for analysts and investors. For companies with historically more volatile revenues, the interest coverage ratio may not be considered good unless it is well above three. The interest coverage ratio serves as a beacon of financial prudence, guiding investors and creditors through the complex terrain of debt management. Its ability to translate intricate financial data into a comprehensible metric makes it an indispensable tool in the arsenal of financial analysts and decision-makers alike. As we navigate the ever-evolving landscape of finance, the interest coverage ratio continues to provide valuable insights into a company’s fiscal health and its ability to navigate the tides of economic uncertainty. If a company has a low-interest coverage ratio, there’s a greater chance the company won’t be able to service its debt, putting it at risk of bankruptcy.

Get instant access to video lessons taught by experienced investment bankers. Learn financial statement modeling, DCF, M&A, LBO, Comps and Excel shortcuts. For each variation, we’ll divide the appropriate cash flow metric by the total interest expense amount due in that particular year. Correctly diagnosing diseases takes years of medical training. Machine Learning have recently made huge advances in automatically diagnosing diseases. It is particularly helpful in areas where the diagnostic information a doctor examines is already digitized.

As we withdraw money from demand deposits, we keep it with us as “currency with public”. Exposures can be higher for people in enclosed spaces with unventilated fumes from gasoline, glues, solvents, paints, and art supplies. Areas of heavy traffic, gas stations, and areas near industrial sources may also have higher air levels. Ans.(d) All statements 1, 2 and 3 are correct. There is no minimum number of days that Parliament is required to meet in a year — in fact, the number of days that Parliament meets has reduced over the years. During the first two decades of Parliament, Lok Sabha met for an average of a little more than 120 days a year.

How often should the interest coverage ratio be calculated?

To calculate DSCR, EBIT is divided by the total amount of principal and interest payments required for a given period to obtain net operating income. Because it takes into account principal payments in addition to interest, the DSCR is a more robust indicator of a company’s financial fitness. The interest coverage ratio measures a company’s ability to handle its outstanding debt. It is one of a number of debt ratios that can be used to evaluate a company’s financial condition. The term “coverage” refers to the length of time—ordinarily, the number of fiscal years—for which interest payments can be made with the company’s currently available earnings.

Cigarette smoke accounts for about half of the exposure to benzene in the United States. Benzene levels in rooms containing tobacco smoke can be many times higher than normal. Article 85 requires that there should not be a gap of more than six months between two sessions of Parliament. The period during which the House meets to conduct its business is called a session. In India usually there are three sessions namely Budget session (January/February to May), Monsoon session (July to August/September) and the Winter session (November to December). But there is no specific mention of three sessions of Parliament, hence 2 is incorrect.

How is interest coverage ratio calculated?

This means that visible light communication, LiFi, free space optical communication, and infrared remote control all fall under OWC. Demands in wireless power transfer is expanding and becoming more attractive especially with Industry 4.0 applications. Power management with circuitry allows energy harvesting from multiple sources such as Piezo elements or engine vibration for future researches. As a result, all coupling methods will be widely used technologies to supply power for artificial intelligent systems.

What Is the Interest Coverage Ratio?

When the government moves Money Bills in the Lok Sabha, the RS cannot do much about it. Many laws have been pushed through, using that route. Similar to other types of insurance policies, cyber insurance policies often exclude certain losses from coverage. Typical exclusions include claims arising from war, breach of contract, theft of trade secrets, unfair trade practices, and employment practices. Cyber insurance policies also typically exclude coverage for willful, intentional, deliberate, malicious, fraudulent, dishonest, or criminal acts or omissions of the insured. Computer data loss and network restoration – covers physical damage to an entity’s computer system and the cost to retrieve and restore damaged or stolen data, hardware, and software.

How to Calculate Interest Coverage Ratio?

Forensic investigation services – covers costs and expenses for technical, legal or other expert services to assess and stop a cyber-incident. So all of 1 and 3 are clearly non-financial in nature – Housing loans held by houeholds and Treasury Bills. So only possible option is (d), which is “1, 2 and 3”. We do have doubt about 2 but there’s no such option (1 and 3 only). Non-financial debt means the debt held by governments, households, and companies not in the financial sector. In India evidences of ship building, port and warehouses installations are datable to Harappan culture.

‘Call money’ is a short-term, interest-paying loan from one to fourteen days to a financial institution to another financial institution. A well-established utility will likely have consistent production and revenue, particularly due to government regulations; so, even with a relatively low-interest coverage ratio, it may be able to reliably cover its interest payments. Other industries, such as manufacturing, are much more volatile and may often have a higher minimum acceptable interest coverage ratio of three or higher. In the image below, MK Lending Corp has outlined its debt requirements for new mortgages.

The more debt principal that a company has on its balance sheet, the more interest expense the company will owe to its lenders — all else being equal. A high ratio indicates there are enough profits available to service the debt. But it may also mean the company is not using its debt properly. For example, if a company is not borrowing enough, it may not be investing in new products and technologies to stay ahead of the competition in the long term. You can use the formula for interest coverage ratio to calculate the ratio for any interest period including monthly or annually. The use of visible light in the transmission of data holds many different key advantages over technologies that make use of radio frequency.

Standing water or saturated soil deprives roots of oxygen. The concept of social cost of carbon (SCC) tries to add up all the quantifiable costs and benefits of emitting one additional tonne of CO2, in monetary terms. This value can then be used interest coverage ratio upsc to weigh the benefits of reduced warming against the costs of cutting emissions. In zero tillage, the crop seed will be sown through drillers without prior land preparation and disturbing the soil where previous crop stubbles are present.

Companies need to have more than enough earnings to cover interest payments in order to survive future and perhaps unforeseeable financial hardships that may arise. A company’s ability to meet its interest obligations is an aspect of its solvency and is thus an important factor in the return for shareholders. The higher the ratio of EBIT to interest payments, the more financially stable the company. This metric only considers interest payments and not payments made on principal debt balances that may be required by lenders.

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