Generally, the greater a firm's times interest earned ratio, the less able it is to meet payments as they come due.

Question

Quizplus · Accepted Answer

The statement is incorrect. The greater the firm's times interest earned ratio, the more easily it can meet its interest payments as they come due. A higher ratio indicates that the company has a larger buffer of earnings to cover its interest expense, indicating its financial strength and ability to make debt payments on time.

Generally, the Greater a Firm's Times Interest Earned Ratio, the Less