# 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.

# Results

## 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**

Where

EBIT = earnings before interest and taxes.

**Example :**

Company XYZ has an EBIT of $1,000 and interest expense of $1,000.

= (1000/1000) = 1

Company XYZ interest coverage ratio is 1.

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