Answer:
The Times-Interest-Earned Ratio or Interest Coverage Ratio is 8.76.
Explanation:
It is calculated by the following formula:
EBIT / Interest Expenses
where EBIT is the Earnings Before Interest and Taxes. It means that you have to deduct all the remaining expenses including manufacturing, operating, and non-cash.
In this case, simply deduct Depreciation & Amortization expenses from EBITDA and you will get EBIT. Now divide the result by Interest Expense and you will be provided with a value of 8.76. It means that for each dollar of interest, the company generates $8.76 of Earnings.
Some authors argue to divide EBITDA by Interest Expenses instead of EBIT. But it is not supported mainly.
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<span>Though leaders have been consistently avoiding
economic crisis, there are still some unavoidable events that cause a lot of
negative effect to the citizens. One of them is stagflation which is constituted
from high unemployment along with high inflation.</span>
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