Which financial ratio measures a company's ability to cover its interest expenses?

کون سا مالی تناسب کسی کمپنی کے اپنے سود کے اخراجات کو پورا کرنے کی صلاحیت کو ماپتا ہے؟

Gross profit margin

Debt-to-equity ratio

Interest coverage ratio

None of these

Interest coverage ratio = EBIT ÷ Interest Expense.

It shows how easily a company can pay interest on outstanding debt.