This is the ratio that measures a firm’s available cash flow to pay its current debt obligations. The DCR shows whether or not a company has enough money to pay its debts, which proves useful for investors. To calculate the DCR, the net operating income must be divided by the total debt service.
Debt-Coverage Ration (DCR)
This is the ratio that measures a firm’s available cash flow to pay its current debt obligations. The DCR shows whether or not a company has enough money to pay its debts, which proves useful for investors. To calculate the DCR, the net operating income must be divided by the total debt service.
