In the analysis of financial leverage, all of the following are referred to as fixed charges except:
A)bond interest
B)common stock dividends
C)bank interest
D)preferred stock dividends

Question

Quizplus · Accepted Answer

Fixed charges refer to expenses that must be paid regardless of a company's level of sales or earnings. These include things like interest on loans and bonds, but do not include common stock dividends, which are only paid out of profits and are not an obligation of the company. Bank interest and preferred stock dividends are also considered fixed charges.

In the Analysis of Financial Leverage, All of the Following