The Times Interest Earned Ratio Is Calculated as

question 105

Multiple Choice

The times interest earned ratio is calculated as

• A)Interest expense/Net income.
• B)Net income/Interest expense.
• C)(Net income + interest expense + tax expense)/Interest expense.
• D)Interest expense/(Net income + interest expense + tax expense).

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Definitions:

Inventories

Producers’ stocks of finished and in-process goods.

Economic Fluctuations

Variations in the economic activity of a country over time, including periods of growth (expansions) and decline (recessions).

Synchronized

The process of operating or occurring at the same time or rate, ensuring coherence and coordination.

Price Level

The average of current prices across the entire spectrum of goods and services produced in the economy, reflecting inflation or deflation.