📊 The times interest earned ratio (TIE ratio), also known as the interest coverage ratio, is a financial metric that helps gauge a company’s ability to meet its debt obligations.
The TIE ratio is an essential tool for businesses to use to predict their future financial stability and incorporate into their operational strategies.
Here's the formula for the TIE ratio:
TIE Ratio = EBIT / Interest Expense
⏱️ TimeStamps
0:11 What is a Tie Ratio
0:21 Times Interest Earned Ratio Formula
0:29 Times Earned Interest Ratio Example
0:58 Outro
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➡️ Times Interest Earned Ratio Explained
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