The___________ ratio may indicate that the firm will not be able to meet interest obligations due on outstanding debt.
A) return on total assets
B) times interest earned
C) debt
D) net profit margin

Question

Quizplus · Accepted Answer

Times interest earned (also known as interest coverage ratio) measures a company's ability to meet interest payments on its outstanding debt. A lower ratio may indicate that the firm will not be able to meet interest obligations due on outstanding debt.

The___________ Ratio May Indicate That the Firm Will Not Be