Asset coverage test

 

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Asset coverage test

A bond indenture restriction that permits additional borrowing if the ratio of assets to debt does not fall below a specified minimum.



Asset coverage test

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Extended coverage

Extended coverage

Insurance which extends the term of a warranty, typically covering repairs on appliances and cars, the premium usually being a one-off payment.


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Total assets less intangibles divided by the total of the market value of the security issue and the book value of liabilities and issues having a prior claim. This is used to determine how much of the market value of a certain class of securities would be covered in liquidation.


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Guaranteed replacement cost coverage insurance

A policy that covers the full cost of replacing damaged property without any allowances or deductions, e.g., depreciation.


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Ratios used to test the adequacy of cash flows generated through earnings for purposes of meeting debt and lease obligations, including the interest coverage ratio and the fixed-charge coverage ratio.


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Net income after interest and taxes (before common stock dividends) divided by preferred stock dividends.


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