0
A times interest earned (TIE) ratio of 2 means that the firm generates enough earnings to cover its interest expenses twice over. This indicates a reasonable level of financial stability, suggesting the company is in a position to meet its debt obligations comfortably. However, while a TIE of 2 is generally considered acceptable, it may also suggest that the firm should aim for a higher ratio to enhance its financial resilience against potential downturns.
What else can I help you with?
How many times the word firm in the bible?
The word 'firm' appears eight (8) times in the KJV Bible.
What is the correct examples of liquidity profitability and solvency ratios?
Liquidity ratios measure a company's ability to meet short-term obligations, with the current ratio and quick ratio as common examples. Profitability ratios assess a firm's ability to generate income relative to revenue, assets, or equity, with examples including the net profit margin and return on equity (ROE). Solvency ratios evaluate a company's long-term financial stability, with the debt-to-equity ratio and interest coverage ratio being key examples. Together, these ratios provide insights into a company's financial health from different perspectives.
How many times does the word stand firm appear in the bible?
The phrase "stand firm" appears 14 times in the New International Version (NIV) of the Bible. It is often used in the context of remaining steadfast in one's faith or convictions. The concept of standing firm is emphasized in various books such as 1 Corinthians, Galatians, Philippians, and 2 Thessalonians.
How many times -stand firm in the bible?
In the King James version the phrase - stand firm - does not appear at all It may appear in other versions/translations
Solve for debt equity ratio with debt ratio of 43?
For a company, the debt ratio indicates the relationship between capital supplied by outsiders and capital supplied by shareholders. Often the debt ratio is computed as total debt (both current and long-term) divided by total assets. Thus if a company has $50,000 in debt and assets of $100,000, its debt ratio is 50%. The debt ratio is also calculated as total debt/shareholders' equity, long-term debt/shareholders' equity, and in other ways. However computed, the debt ratio provides insight into the firm's capital structure and will vary across industries. A low debt ratio isn't necessarily best: If a company can earn a greater return on debt than its cost, the firm should borrow more and raise its debt ratio -- provided the debt burden won't be crushing when business slows. Turning to consumers, the debt ratio is often shorthand for the "debt to income" ratio, i.e., an individual's monthly minimum debt payments divided by monthly gross income. The debt ratio is monitored by credit card companies and determines the consumer's ability to obtain additional credit
What advantage does the fixed charge coverage ratio offer over simply using times interest earned?
The fixed charge coverage ratio measures the firm's ability to meet all fixed obligations rather than interest payments alone, on the assumption that failure to meet any financial obligation will endanger the position of the firm
If a firm has both interest expense and lease payments would times interest earned be smaller than fixed charge coverage?
times interest earned be smaller than fixed charge coverage
Which ratio may indicate that the firm will not be able to meet interest obligations due on outstanding debt?
The interest coverage ratio is a key indicator that may suggest a firm will struggle to meet its interest obligations on outstanding debt. This ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses. A ratio less than 1 indicates that the firm is not generating enough earnings to cover its interest expenses, signaling potential difficulties in meeting debt obligations.
What the ratio may indicate that the firm will not be able to meet interest obigations due on outstanding?
A low interest coverage ratio, typically below 1.0, may indicate that a firm is unable to meet its interest obligations on outstanding debt. This ratio is calculated by dividing earnings before interest and taxes (EBIT) by interest expenses; if the ratio is less than one, it suggests that the firm's earnings are insufficient to cover interest payments. Consequently, this could signal financial distress or potential default on debt obligations, raising concerns among creditors and investors.
How do you calculate debt service coverage ratio of a firm?
Debt Service Coverage Ratio = Interest payable on debt/Net Profit
What ratios assess the degree of financial leverage in a firm's capital structure?
Ratios that assess the degree of financial leverage in a firm's capital structure include the debt-to-equity ratio, which compares total liabilities to shareholders' equity, indicating the proportion of debt financing relative to equity. The debt ratio, calculated as total debt divided by total assets, shows the percentage of a firm's assets financed by debt. Additionally, the interest coverage ratio, which measures earnings before interest and taxes (EBIT) against interest expenses, evaluates a firm's ability to meet its interest obligations. These ratios provide insights into the firm's financial risk and leverage position.
If the firm's sales revenue income exceeds its expenses the firm has earned a profit?
If a firm's sales revenue exceeds its expenses, the firm has earned a profit.
What is ideal quick ratio of a firm?
Quick ratio means
A firm that is motivated by self interest should use how much input?
A firm that is motivated by self interest should:
When evaluating the operating efficiency of a firm's managers What ratio would you look at?
When evaluating the operating efficiency of a firm's managers, you would look at the Asset Evaluation Ratio.
A firm with earnings per share of 5 and a price-earnings ratio of 15 will have a stock price of?
Just use 5 times 15. $75.
Which term refers to the cost of a firm incurs for capital goods?
Interest
