DEBT SERVICE COVERAGE Definition

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DEBT SERVICE COVERAGE is the ratio of cash flow available to pay for debt to the total amount of debt payments to be made (interest and principal payments).

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INDENTURE is an agreement between lender and borrower which details specific terms of the bond issuance. Specifies legal obligations of bond issuer and rights of bondholders. There is usually a indenture document spelling out the specific terms of a bond as well as the rights and responsibilities of both the issuer of the security and the holder.

SELL-THROUGH ACCOUNTING is where revenue is not recognized until after the product has been subsequently shipped from the wholesalers. See SELL-IN ACCOUNTING.

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