A method for determining the debt limitation of a company based on its ability to repay debt commitments from earnings. The test calculates the number of times the interest payments can be covered by cash flow. If the number falls below a certain limit, the company fails the test and is unable to issue more long term debt.
Related information about interest coverage test:
- Interest coverage test (IC test)
In a cashflow CDO, a measure to protect senior note holders in the event of a reduction in the cashflows...
- Interest Coverage Test - Financial Dictionary - The Free Dictionary
A debt limitation that prohibits the issuance of additional long-term debt if the issuer's interest coverage would, as a result of the issue, fall below some specified ...
- What is interest coverage test? definition and meaning
Definition of interest coverage test: A method for determining the debt limitation of a company based on its ability to repay debt commitments from earnings.
- Interest coverage test - Financial Definition
Financial Definition of Interest coverage test and related terms: A debt limitation that prohibits the issuance of additional long-term debt if the issuer'...
- Interest Coverage Test Definition
Interest Coverage Test A method of limiting debt that prohibits the issuer from taking additional debt for the long term when the interest coverage will.
- * Interest cover - (Business): Definition
http://www.special-loans.com/dictionary.asp?a=section&q=i&skip=560. Interest coverage test. A debt limitation that prohibits the issuance of additional long-term ...
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Apr 15, 2011 ... 292%. *) overcollateralisation above the requirement of the Asset Coverage Test. Excess Overcollateralisation*. Interest Coverage Test. PASS ...
- Interest coverage ratio Definition - NASDAQ.com
Nearby Terms. Interdelivery spreadInterest Interest coverage ratioInterest coverage testInterest deduction. Investing Essentials. Investing; Stocks; Bonds; Options ...