Cash Available for Debt Service


Also found in: Medical, Acronyms, Encyclopedia.

Cash Available for Debt Service

Ratio of cash assets to debt service (interest plus nearby principal). Used in evaluating the risk of a project or firm. The higher the ratio the less likely the firm or project will fail to meet its debt obligations.

Cash Available for Debt Service

A ratio of a company's cash on hand to its debt service. A ratio of less than 1 indicates that the company is unable to service its debt while a ratio of 1 means that it can service its debt, but that doing so will result in no remaining cash on hand. Thus, shareholders and potential lenders prefer to have the cash available for debt service to be as high as possible.
Mentioned in ?
References in periodicals archive ?
However, total leverage is moderate to high at 12x net debt to cash available for debt service (CFADS) with increasing debt service obligations through 2030.
5 times (x) net debt to cash available for debt service (CFADS) results in strong free cash flow and healthy debt service coverage ratios through the life of the debt at or near 2.
3x net debt to cash available for debt service with a strong liquidity position of about $33.