Interest Coverage Ratio Calculator
This tool is used to calculate the company interest coverage ratio based on earnings before interest and taxes and interest expense instantly.
Formula To Calculate Interest Coverage Ratio :
This is a debt and profitability ratio used to determine how easily a company can pay interest on its outstanding debt.
To calculate the Interest Coverage Ratio(financial), use the following formula
Interest Coverage Ratio = EBIT / Interest Expense
EBIT = earnings before interest and taxes.
Company XYZ has an EBIT of $1,000 and interest expense of $1,000.
= (1000/1000) = 1
Company XYZ interest coverage ratio is 1.