The higher the "times‑interest‑earned," the safer (i.e., more assured) should be interest payments.

Name: The higher the "times‑interest‑earned," the safer (i.e., more assured) should be interest payments.
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Question

The higher the "times‑interest‑earned," the safer (i.e., more assured) should be interest payments.​

Quizplus · Accepted Answer

The times-interest-earned ratio measures a company's ability to cover its interest payments with its earnings. A higher ratio indicates that the company is more capable of meeting its interest obligations, making interest payments safer and more assured.

The Higher the "Times‑interest‑earned," the Safer (I