Enter the total EBITDA ($) and the total interest expense ($) into the Time Interest Earned Ratio Calculator. The calculator will evaluate and display the Time Interest Earned Ratio.

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## Time Interest Earned Ratio Formula

The following formula is used to calculate the Time Interest Earned Ratio.

TIER = EBITDA / E

- Where TIER is the Time Interest Earned Ratio ( )
- EBITDA is the total EBITDA ($)
- E is the total interest expense ($)

To calculate the time interest earned ratio, divide the total EBITDA by the total interest expense.

## How to Calculate Time Interest Earned Ratio?

The following example problems outline how to calculate Time Interest Earned Ratio.

Example Problem #1:

- First, determine the total EBITDA ($).
- The total EBITDA ($) is given as: 5000.

- Next, determine the total interest expense ($).
- The total interest expense ($) is provided as: 3000.

- Finally, calculate the Time Interest Earned Ratio using the equation above:

TIER = EBITDA / E

The values given above are inserted into the equation below and the solution is calculated:

TIER = 5000 / 3000 = 1.66 ( )

Example Problem #2:** **

For this problem, the variables required are provided below:

total EBITDA ($) = 6000

total interest expense ($) = 8000

Test your knowledge using the equation and check your answer with the calculator above.

TIER = EBITDA / E** = ?**