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Debt ratio. The debt ratio is a financial ratio that indicates the percentage of a company's assets that are provided via debt. It is the ratio of total debt and total assets : where, total debt comprises short-term and long-term liabilities and total assets is the sum of current assets, fixed assets, and other assets such as ' goodwill ...
The debt-to-equity ratio ( D/E) is a financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets. [1] Closely related to leveraging, the ratio is also known as risk, gearing or leverage. The two components are often taken from the firm's balance sheet or statement of financial position ...
One application is in the current ratio, defined as the firm's current assets divided by its current liabilities. A ratio higher than one means that current assets, if they can all be converted to cash, are more than sufficient to pay off current obligations. All other things equal, higher values of this ratio imply that a firm is more easily ...
Debt-to-capital ratio. A company's debt-to-capital ratio or D/C ratio is the ratio of its total debt to its total capital, its debt and equity combined. The ratio measures a company's capital structure, financial solvency, and degree of leverage, at a particular point in time. [1] The data to calculate the ratio are found on the balance sheet .
A financial ratio or accounting ratio states the relative magnitude of two selected numerical values taken from an enterprise's financial statements. Often used in accounting, there are many standard ratios used to try to evaluate the overall financial condition of a corporation or other organization. Financial ratios may be used by managers ...
Such assets are expected to be realised in cash or consumed during the normal operating cycle of the business. On a balance sheet, assets will typically be classified into current assets and long-term or fixed assets. The current ratio is calculated by dividing total current assets by total current liabilities.
Investment Risk: Investment risk is relevant to ALM since it is a collection of other types of risk impacting the expected value of the assets and liabilities held by the firm. There is volatility ...
The current account is an important indicator of an economy's speed. It is defined as the sum of the balance of trade (goods and services exports minus imports ), net income from abroad, and net current transfers. A positive current account balance indicates the nation is a net lender to the rest of the world, while a negative current account ...