Interest Expense

Interest Expense
The cost of interest on outstanding debt. Here, it includes all fixed interest expenses net of capitalized interest. Also includes dividends on preferred stock of unconsolidated subsidiaries, if any.

Definition
Noninterest expense
The sum of personnel compensation, legal expense, office occupancy and equipment expense, other noninterest expense and loan loss provisions.
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Interest Expense to Total Debt Formula
Interest Expense
Short-Term Debt ...

An Interest expense, such as interest On a margin account, that is allowed as a Deduction for tax purposes.

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Interest Expense
The interest paid out by a corporation for loans and debt securities issued.

Interest Expense
The amount reported by a company or individual as an expense for borrowed money.
In the U.K. it is called "interest payable".

Interest Expense / Interest Income
When a company places cash in short-term investments such as certificates of deposit, savings accounts, and money market accounts, the money in these accounts earns interest.

Interest expense
Interest expense is the money the corporation or individual pays out in interest on loans.
Interest in Arrears
Interest that is due only at the maturity date rather than periodically over the life of the loan.

Interest expense
In a corporate setting, interest expense is the money the company or corporation pays out in interest on loans.
Interest on interest
Interest earned on reinvestment of each interest payment on money invested. See: compound interest.

The interest expense a consumer pays for debt that is expressed in simple, annual-percentage terms. The Federal Truth in Lending Act requires that each consumer loan agreement includes the APR.
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The interest expense on money borrowed to finance a securities position.
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Formula
EBIT
Interest Expense
Long-term Debt to Net Working Capital
Provides insight into the ability to pay long term debt from current assets after paying current liabilities.

One interest coverage ratio (EBITDA/Interest Expense) is used to determine a firm's ability to pay interest on outstanding debt. The greater the multiple of cash available for interest payments, the less risk to the lender.

interest deduction A tax deduction allowed for certain interest expenses, such as those on a home mortgage or a margin account. interest expense An expense for interest on a loan made to an individual, corporation or other entity.

Carrying Cost The interest expense incurred when borrowed money is used to finance a stock or option position.

The act eliminated deductions for interest expenses associated with buying personal consumption goods.

To calculate the interest coverage ratio take the operating income (EBIT) and divide by the interest expenses.

Americans have become so enthralled with ownership of real estate that they often don't realize a property increasing in value from $500,000 to $580,000 within five years, after backing out the after-tax interest expense on the mortgage, ...

This is earnings before interest and taxes divided by interest expense. For most companies, both the long-term and total interest coverage are shown unless they are identical.

The interest coverage ratio tells us how easily a company is able to pay interest expenses associated to the debt they currently have.

Next companies must account for interest income and interest expense. Interest income is the money companies make from keeping their cash in interest-bearing savings accounts, money market funds and the like.

NET INTEREST COST (NIC) - A method of computing the interest expense to the issuer of bonds, which may serve as the basis of award in a competitive sale.

So, all the trouble is with the crazy tax laws (the same ones which ENCOURAGE a company to get deeply in debt, by making interest expense tax deductible for the company while dividends aren't).

Interest coverage ratioThe ratio of the earnings available for paying the interest for a given year to the annual interest expense.

Look up pretax earnings, and add back interest expense- this gives earnings before interest and taxes (EBIT). Divide EBIT by interest expense, and you will know how many times the company could have paid the interest expense on its debt.

The interest coverage ratio calculated by dividing company's earnings before the interest and the taxes (EBIT) of one period by the company's interest expenses of the same period. The lower ratio, the more the company burdened by debt expense.

Interest Coverage Ratio = EBITA/Interest Expense
EBITDA is short for earnings before interest, taxes, depreciation and amortization (wow that’s a mouthful).

Interest Coverage = EBIT / Interest Expense
An interest coverage of 3 or above is considered reasonable. This means that the company's operating income (EBIT: earnings before interest and tax) can cover the interest payments 3 times over.

Also known as Times Interest Earned, the Interest Coverage ratio is a measure of a company's ability to pay its debt. Divide PBIT by Interest Expense, and you will know how many times the company could have paid the interest expense on its debt.

This model assumes that there is no interest expense or tax benefit from that interest expense.

Net Interest Income Interest income less interest expense.
Net Premium Amount of premium required to provide insurance benefits for a policy.

However, a financial institution may deduct 80 percent of its interest expense allocable to "qualified tax-exempt obligations, ...

Operating margin shows you how profitable a company is before interest expenses on debt and depreciation costs have been deducted.

Interest Coverage: a measure of a company's ability to pay interest on its debts (operating income divided by interest expenses).
Institutional Ownership: Shares owned by pension funds, mutual funds, banks, etc.

The ratio of the earnings available for paying the interest for a given year to the annual interest expense.
Interest rate agreement ...

A measure of a company's ability to pay interest on its debt (operating income divided by interest expenses).
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Increasing numbers of taxpayers trigger the AMT if they deduct high state and local taxes or mortgage interest expenses, exercise a large number of stock options, or have significant tax-exempt interest.

Parent issues debt and pays interest, so Parent may deduct interest expense. Subsidiary issues preferred shares and pays dividends, so corporations that buy MIPS get a dividend exclusion.

See also: Interest, Investment, Market, Share, Stock