Question

For the times interest earned ratio, it DOES NOT tell you, "How stockholders return their measurement on investment."

a. True
b. False

Answer 1

The times interest earned ratio is a financial metric used to assess a company's ability to cover its interest expense and provide a return to stockholders.

Step-by-step explanation:

The statement that the times interest earned ratio does not tell you how stockholders return their measurement on investment is FALSE. The times interest earned ratio is a financial metric used to assess a company's ability to cover its interest expense with its operating income. It measures the company's capacity to make interest payments on its debt obligations and indicates how well the company can generate earnings to support its debt obligations and provide a return to stockholders.