What is primarily focused on when assessing a company's ability to cover its debt-related payments?

When assessing a company's ability to cover its debt-related payments, the focus is primarily on the income statement and cash flows. This is because these financial statements provide critical information about the company’s profitability and cash generation capabilities.

The income statement reveals the company's revenues, expenses, and profits over a specific period, which helps analysts understand whether the company is generating sufficient earnings to meet its debt obligations. Key metrics like interest coverage ratio, which compares earnings before interest and taxes (EBIT) to interest expenses, can be derived from the income statement, indicating how easily the company can pay interest on its debt.

Additionally, cash flow statements are essential as they show the actual cash generated or used in operations. This brings insight into the liquidity of the company, allowing analysts to evaluate if it has enough cash flow to cover not just operational expenses but also debt repayments. Metrics like cash flow to debt ratio can provide further clarity on the adequacy of cash flow relative to total debt.

Together, the income statement and cash flow statements form a comprehensive view of a company's financial health concerning its debt servicing capabilities, making them the primary focus when assessing debt obligations.