题目
题目

MSB-250-300-002 Proctored Midcourse Exam 1

单项选择题

A times interest earned ratio of 7.0 indicates that the firm

选项
A.pays seven times more in interest expense than it has in earnings.
B.has low tax liability.
C.can cover (pay for) the firms interest expense 7 times with its earnings.
D.has interest expense equal to 7% of EBIT.
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标准答案
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思路分析
To evaluate what a times interest earned ratio of 7.0 means, we first recall how TIE is defined: TIE = EBIT / Interest expense. A TIE of 7 indicates EBIT is seven times larger than the interest expense the firm must pay. Option 1: 'pays seven times more in interest expense than it has in earnings.' This is ......Login to view full explanation

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