The minimum lenders typically require for DCR in the first year is:

Question

Quizplus · Accepted Answer

The Debt Coverage Ratio (DCR) is a measure of a company's ability to meet its loan payments on time. The higher the DCR, the more likely lenders are willing to extend credit. A DCR of 1.2 means that the company's net operating income (NOI) is 120% of the annual debt service (loan payments). This is the minimum ratio that lenders typically require in the first year, as it provides a cushion for unexpected expenses or fluctuations in income. Therefore, choice C, 1.2, is the best answer.

The Minimum Lenders Typically Require for DCR in the First