# Times Interest Earned Ratio (TIE) Calculator

This tool is used to calculate the company times interest earned ratio based on earnings before interest taxes and interest expenses instantly.

# Results

## Formula To Calculate Times Interest Earned Ratio (TIE) :

TIE measures how easily a firm can pay its debts with its current income.

To calculate the Times Interest Earned Ratio(financial), use the following formula

**Times Interest Earned = EBIT / Interest Expense**

Where

EBIT - Earnings before Interest and Taxes

**Example :**

Company XYZ has an EBIT of $4,000 and interest expense of $2,000.

Times Interest Earned = (4000/2000) = 2

Therefore, this company XYZ has a times interest earned of 2, meaning that Company XYZ income is 2 times greater than the annual interest expense.

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