Vikki Velasquez is a researcher and writer who has managed, coordinated, and directed various community and nonprofit organizations. She has conducted in-depth research on social and economic ...

The times interest earned ratio is a common solvency ratio used ... A ratio of 5 means that the business can meet the total interest payments owed on its outstanding, long-term debt five times ...

A company’s times interest ratio indicates how ... Times interest earned is calculated by dividing earnings before interest and taxes (EBIT) by the total amount owed on the company’s debt.

The Times Interest Earned ratio, also known as the interest coverage ... DSCR = Operating Cash Flow ÷ Total Debt Service Where Total Debt Service includes both interest and principal payments.

Times interest earned ratio is also known as Interest Coverage Ratio Typically you would look at this ratio along with the debt to total assets ratio. The debt to total assets ratio measures the ...

Calculating the ICR, which is also sometimes called the “times interest earned ratio,” requires two numbers, both of which are ordinarily available on a company’s income statement.

The times interest earned ratio formula is earnings before interest and taxes (EBIT) divided by the total amount of interest due on the company's debt, including bonds. TIE = EBIT / Total Amount ...

and the figures necessary to calculate the times interest earned are found easily on a company's income statement. For example, a ratio of 5 means the business is able to meet the total interest ...