Debt Service Coverage Ratio (DSCR)
In the circumstances of corporate finance, the debt-service coverage ratio (DSCR) is the ratio of a firm’s existing cash flow to pay current debt obligations. The DSCR illustrates whether a real estate property generates adequate income to pay its debts.
Calculating DSCR: –
For calculating debt service coverage ratio net operating income and the total debt servicing of the entity are required.
DSCR = Net operating income / Total debt service
Net operating income is the difference between revenue and certain other expenses.
Total debt service is the current debt obligations
This help page and the information contained herein is provided for informational and discussion purposes only and is not intended to be a recommendation for any investment or other advice of any kind, and shall not constitute or imply any offer to purchase, sell or hold any security or to enter into or engage in any type of transaction.
Investing in venture capital funds is inherently risky and illiquid. It involves a high degree of risk and is suitable only for sophisticated and qualified investors.