What Is Interest Coverage? How To Calculate It And What It Means
https://www.analystinterview.com/article/what-is-interest-coverage-how-to-calculate-it-and-what-it-means
WebInterest Coverage Ratio = EBIT / Interest Expenses = $500,000 / $100,000 = 5. In this example, Company XYZ has an Interest Coverage Ratio of 5, indicating that its earnings are five times higher than its interest expenses. Interpreting Interest Coverage Ratio. The interpretation of the Interest Coverage Ratio varies across industries.
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