ACCOUNTING TERMS - ACCOUNTING DICTIONARY - ACCOUNTING GLOSSARY
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ADMITTED ASSETS Definition
ADMITTED ASSETS are assets whose values are permitted by state law to be included in the annual statement.
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TIMES INTEREST EARNED (TIE) measures the extent to which operating income can decline before the firm is unable to meet its annual interest costs. The TIE ratio is used by bankers to assess a firm's ability to pay their liabilities. TIE determines how many times during the year the company has earned the annual interest costs associated with servicing its debt. Normally, a banker will be looking for a TIE ratio to be 2.0 or greater, showing that a business is earning the interest charges two or more times each year. A value of 1.0 or less suggests that the firm is not earning sufficient amounts to cover interest charges. Formula: Earnings Before Interest & Taxes [EBIT] / Interest Charges
HEALTHY, from a corporate perspective, usually means that the subject entity is financially secure, positioned well within the market and functioning well.
