Which of the Following Is the Formula to Compute Times-Interest-Earned

question 112

Multiple Choice

Which of the following is the formula to compute times-interest-earned?

• A)Income from operations/interest expense
• B)Interest expense/income from operations
• C)Total liabilities/total assets
• D)Total assets/total liabilities

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Definitions:

Operating Cash Flow

An assessment of the cash income resulting from a company's standard operational processes.

Millions

A numerical term representing one thousand thousands, or 1,000,000.

Common Stock

A type of equity security that represents ownership in a corporation, with rights to vote on corporate matters and receive dividends.

Net Income

The conclusive financial profit of a company after subtracting expenses and tax payments from its revenue stream.