Year 1: DSCR = (Net profit + Interest + Depreciation) / (Repayment)
= (21.67 + 19.14) / 10.70 = 1.41
Year 2: DSCR = (Net profit + Interest + Depreciation) / (Repayment)
= (34.77 + 17.64) / 18 = 1.92
Average DSCR = (1.41 + 1.92) / 2 = 1.67
© Tata McGraw-Hill Publishing Company Limited, Management Accounting 6 - 31
Profitability Ratios
Profitability ratios measure the combined effects of liquidity, asset
management and debt on operating results. They