In 2012,H Co's times interest earned ratio was 2.51 while T Co's ratio for that year was .80.Which of the following statements is false?
A)H Co's ratio appears to provide adequate coverage of interest from its present profit.
B)Since H Co's is actively pursuing growth through investment in other companies,its ratio may improve once those investments begin to generate additional profit.
C)T Co's ratio is very low and they present high risk to their creditors and investors.
D)None of the responses is false.

Question

Quizplus · Accepted Answer

All the statements accurately describe the implications of the times interest earned ratios for H Co and T Co.

In 2012,H Co's Times Interest Earned Ratio Was 2