What Kind of Information Does a Company's Times-Interest-Earned Ratio Provide

question 145

Multiple Choice

What kind of information does a company's times-interest-earned ratio provide?

• A) What proportion of the company's debts are long-term liabilities
• B) What proportion of the company's assets are financed by debt, as opposed to equity
• C) How well a company is positioned to pay interest expense on its debt
• D) How much profit is generated by each share of stock

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Definitions:

Prices

The sum of money anticipated, needed, or paid in exchange for something.

Acquire Goods

The process of obtaining products or commodities through purchase, trade, or other means.

Services

Useful functions, acts, or performances provided by one party to another, often in exchange for payment.

One Buyer

One buyer refers to a market situation where a single customer or entity has significant buying power or is the sole purchaser of a product or service.