Debt-to-asset ratio
Also known as debt asset ratio, it shows the percentage of your company’s assets financed by creditors.
Bankers often use the debt-to-asset ratio to see how your assets are financed. In general, a bank will consider a lower ratio to be a good indicator of your ability to repay your debts or take on additional debt to support new opportunities. A high ratio indicates a substantial dependence on debt and could be a sign of financial weakness.
How to calculate the debt-to-asset ratio:
Formula
LIABILITIES
ASSETS
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