solvency ratio

Definition

Any of several formulas used to gauge a company's ability to meet its long-term obligations. It is calculated as total net worth divided by total assets.

Use solvency ratio in a sentence

You need to try and make sure that you know what the solvency ratio suggests and adapt to it quickly.

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Determining the solvency ratio for our company was pretty hard and it required an expert to try and figure out for us.

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My portfolio has increased with the exception of three stocks that I failed to incorporate the solvency ratio on and I have to sell at a loss.

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solvency solvent