Skip to main content
Financial Accounting
My Course
Learn
Exam Prep
AI Tutor
Study Guides
Flashcards
Explore
My Course
Learn
Exam Prep
AI Tutor
Study Guides
Flashcards
Explore
Back
Ratios: Times Interest Earned (TIE)
Download worksheet
Problem 1
Problem 2
Problem 3
Problem 4
Problem 5
Problem 6
Problem 7
Problem 8
Problem 9
Problem 10
Ratios: Times Interest Earned (TIE)
Download worksheet
Practice
Summary
Previous
9 of 10
Next
14. Financial Statement Analysis / Ratios: Times Interest Earned (TIE) / Problem 9
Problem 9
Why is maintaining a high times interest earned ratio crucial for avoiding loan default?
A
It ensures the company has high liquidity.
B
It guarantees high profitability.
C
It guarantees a high market share.
D
It ensures the company can consistently meet interest obligations, reducing default risk.
AI tutor
0
Show Answer