debt to worth ratio

Definition

Ratio that measures a firm's ability to absorb losses, without reducing its ability to service existing debt. Lower this ratio, greater the size of buffer available to creditors/lenders. Formula: (Accounts payable + Long-term debt + Other loans) ÷ Total net worth.


debt to worth ratio is...

Nearby Terms

Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z