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Solvency |
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SolvencyAbility to meet obligations.Solvency Similar MatchesInsolvencyInsolvencyThe inability of a person or company to settle debts when they become payable. Insolvency riskInsolvency riskThe risk that a firm will be unable to satisfy its debts. Also known as bankruptcy risk. Accounting insolvencyAccounting insolvencyTotal liabilities exceed total assets. A firm with a negative net worth is insolvent on the books. Short term solvency ratiosShort term solvency ratiosRatios used to judge the adequacy of liquid assets for meeting short-term obligations as they come due, including (1) the current ratio, (2) the acid test ratio, (3) the inventory turnover ratio, and (4) the accounts receivable turnover ratio. |
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