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Solvency Risk Ratio Formula

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Solvency Risk Ratio measures the proportion of a company's assets that are financed by equity versus debt. Check FAQs

SRR = \frac{TA}{TLTD}

SRR - Solvency Risk Ratio?TA - Total Assets?TLTD - Total Long Term Debt?

Solvency Risk Ratio Example

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Here is how the Solvency Risk Ratio equation looks like with Values.

Here is how the Solvency Risk Ratio equation looks like with Units.

Here is how the Solvency Risk Ratio equation looks like.

1.8947 = \frac{720000}{380000}

1.8947 = \frac{720000}{380000}

1.8947 = \frac{720000}{380000}

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Solvency Risk Ratio Solution

Follow our step by step solution on how to calculate Solvency Risk Ratio?

FIRST Step Consider the formula

SRR = \frac{TA}{TLTD}

Next Step Substitute values of Variables

∴

SRR = \frac{720000}{380000}

Next Step Prepare to Evaluate

∴

SRR = \frac{720000}{380000}

Next Step Evaluate

∴

SRR = 1.89473684210526

LAST Step Rounding Answer

∴

SRR = 1.8947

Solvency Risk Ratio Formula Elements

Variables

Solvency Risk Ratio

Solvency Risk Ratio measures the proportion of a company's assets that are financed by equity versus debt.

Symbol: SRR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Solvency Risk Ratio

Total Assets

Total Assets refer to the aggregate value of all assets owned or controlled by a company, organization, or individual.

Symbol: TA

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Total Assets

Total Long Term Debt

Total Long Term Debt refers to the aggregate amount of debt that a company owes with a maturity date longer than one year from the balance sheet date.

Symbol: TLTD

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Total Long Term Debt

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How to Evaluate Solvency Risk Ratio?

Solvency Risk Ratio evaluator uses Solvency Risk Ratio = Total Assets/Total Long Term Debt to evaluate the Solvency Risk Ratio, The Solvency Risk Ratio is a financial metric used to assess the long-term financial stability and ability of a company to meet its long-term debt obligations. Solvency Risk Ratio is denoted by SRR symbol.

How to evaluate Solvency Risk Ratio using this online evaluator? To use this online evaluator for Solvency Risk Ratio, enter Total Assets (TA) & Total Long Term Debt (TLTD) and hit the calculate button.

FAQs on Solvency Risk Ratio

What is the formula to find Solvency Risk Ratio?

The formula of Solvency Risk Ratio is expressed as Solvency Risk Ratio = Total Assets/Total Long Term Debt. Here is an example- 1.894737 = 720000/380000.

How to calculate Solvency Risk Ratio?

With Total Assets (TA) & Total Long Term Debt (TLTD) we can find Solvency Risk Ratio using the formula - Solvency Risk Ratio = Total Assets/Total Long Term Debt.

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Solvency Risk Ratio Formula

Solvency Risk Ratio Example

Solvency Risk Ratio Solution

Solvency Risk Ratio Formula Elements

Other formulas in Debt Management category

How to Evaluate Solvency Risk Ratio?

FAQs on Solvency Risk Ratio

Variable Name