The times-interest-earned ratio is one, but not the only, indication of a firm's ability to meet its long-term and short-term debt obligations.

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The times-interest-earned ratio is one of several financial ratios that are used to evaluate a firm's ability to meet its debt obligations. Other ratios, such as the debt-to-equity ratio and the current ratio, also provide valuable information about a firm's financial health. Therefore, while the times-interest-earned ratio is important, it should be considered in conjunction with other financial ratios and other factors that may affect a firm's ability to meet its debt obligations.

The Times-Interest-Earned Ratio Is One, but Not the Only, Indication