The Higher the Times Interest Earned Ratio, the Better the Creditors

question 122

True/False

The higher the times interest earned ratio, the better the creditors' protection.

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Definitions:

Current Liabilities

Financial obligations or debts a company is expected to settle within one fiscal year or its operating cycle, whichever is longer.

Paid Within One Year

Refers to obligations or debts that are due to be paid off within a twelve-month period.

Net Property

The total value of a company’s property, plant, and equipment assets after deducting accumulated depreciation and impairment losses.