please answer both i am unsure of the first quesiton

Which of the following statements is correct? A ratio that indicates a firm's long- term debt-paying ability from the balance sheet view is the times interest earned. Some of the items on the income statement that are excluded in order to compute times interest earned are interest expense, income taxes, and interest income. Usually, the highest times interest coverage in the most recent five-year period is used as the primary indication of the interest coverage. Capitalized interest should be included with interest expense when computing times interest earned. In regards to cash flow what type of account is inventory? Investing Financing Operating Noncash