Multiple Choice
Which of the following statements about the times-interest-earned ratio is true?
A) A lower ratio indicates a higher debt paying ability.
B) Debt reduction leads to an increase in interest expense.
C) The times-interest-earned ratio is also called the interest-coverage ratio.
D) The times-interest-earned ratio is calculated by dividing gross income by interest expense.
Correct Answer:
Verified
Correct Answer:
Verified
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