Final answer:
The net cash provided by operating activities divided by average total liabilities is known as the cash debt coverage ratio, which measures a company's ability to repay its debts from operating cash flow.
Step-by-step explanation:
The ratio of net cash provided by operating activities divided by average total liabilities is known as the cash debt coverage ratio. This ratio reflects a company's ability to repay its total liabilities from the cash generated from its operating activities, over a certain period, normally one year. It is a measure of financial solvency and indicates the cash available to pay debts. The measurement is useful for comparing the total cash regularly generated by a company with its current and long-term liabilities. It can give investors an idea of the company's financial strength.