What Is the Formula for Calculating the Times-Interest Earned (TIE)

question 3

Multiple Choice

What is the formula for calculating the times-interest earned (TIE) ratio?

• A) TIE ratio = Interest charges ÷ Total liabilities
• B) TIE ratio = Earnings per share ÷ Interest charges
• C) TIE ratio = Sales ÷ Interest charges
• D) TIE ratio = EBIT ÷ Interest charges
• E) TIE ratio = Interest charges ÷ Net income

---

Definitions:

Universal Suffrage

Refers to the right of all adult citizens to vote, regardless of gender, race, or social status, in elections.

Continental Congress

First meeting of representatives of the colonies, held in Philadelphia in 1774 to formulate actions against British policies; in the Second Continental Congress (1775–1789), the colonial representatives conducted the war and adopted the Declaration of Independence and the Articles of Confederation.

Language of Freedom

Often refers to the rhetoric and terminology used to discuss and promote concepts of liberty, rights, and democracy, particularly in political and social contexts.

Abigail Adams

An early American advocate for women's rights and the wife of John Adams, the second President of the United States.