Interest cover

 

 

 

Interest cover

 

Glossary of business

 

Definition of interest cover

 

The interest cover ratio is a measure of how easily the firm can meet the interest payments on any debts that they have. It is calculated by dividing the profit before tax and interest by the amount of interest paid. A figure of one would therefore mean that the firm would need to use all its profit to pay their interest. The lower the figure the more easily the firm can cover their interest payments.

 

Source : http://business-tes.wikispaces.com/file/view/Glossary.doc

link: http://business-tes.wikispaces.com/

Author : not indicated on the source document of the above text

 

Terminology about business

 

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Definition and meaning of interest cover

 

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Meaning of interest cover

 

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