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Times interest earned – cash basis

Time interest earned – cash basis

Description

Time interest earned – cash basis is very similar to TIE. The only difference is that this ratio is calculated relying on the background of cash flow as TIE is calculated relying on EBIT. Data to calculate this ratio is collected from cash flow statement.

Norms and limitations

There are no general norms for this ratio

It is recommended to compare this ratio with the ratios of companies working within the same industry.

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