Solved: What is the firms times-interest-earned ratio, Finance Basics

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What is the firms times-interest-earned ratio

Question 1. Stockbridge Industries has a total asset turnover ratio of 4.1x and net annual sales of $49.2 million. If Stockbridge has $6 million of total debt on its balance sheet, what is the firm's debt ratio?

Question 2. Stockbridge pays 10% annual interest on its outstanding debt. If the firm's total operating costs (including depreciation and amortizatin) equal $37 million, what is the firm's times-interest-earned (TIE) ratio?

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Finance Basics: What is the firms times-interest-earned ratio

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