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How to Understand The Interest Coverage Ratio, Why It is Useful and Important Indicator

Photo by olieman.eth on Unsplash

The interest coverage ratio, also known as the earned interest ratio, is the ratio of the pre-interest and tax income obtained by the production and operation of the enterprise its an indicator to measure the long-term solvency of the enterprise. By analyzing the indicator of interest coverage ratio, creditors can measure the degree of…

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